Question:
Calculate the amount due if Thomas borrowed a sum of $3800 at 6% simple interest for 3 years.
Correct Answer
$4484
Solution And Explanation
Solution
Given,
Principal (P) = $3800
Rate of Simple Interest (SI) = 6%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% per annum.
Method (1) Using Formula
Calculation of Simple Interest
Formula to Calculate Simple Interest
Simple Interest (SI) = Principal × Rate × Time
Thus, Simple Interest (SI) = $3800 × 6% × 3
= $3800 ×6/100 × 3
= 3800 × 6 × 3/100
= 22800 × 3/100
= 68400/100
= $684
Thus, Simple Interest = $684
Calculation of Amount
The total money paid to the lender by a borrower is called the Amount.
In other words, sum of priciple and interest is called the Amount.
Formula to Calculate the Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $684
= $4484
Thus, Amount to be paid = $4484 Answer
Method (2)
Calculation of Amount when Principal, Rate of Simple Interest and Time are given
Calculation of Amount directly using Principal, SI, and Time
Formula to calculate the Amount
Amount (A) = Principal (P) + Principal(P) × Rate of Interest (SI) × Time (t)
⇒ A = P + PRT
Here in the question, P = $3800
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 3 years
Thus, Amount (A)
= $3800 + ($3800 × 6% × 3)
= $3800 + ($3800 ×6/100 × 3)
= $3800 + (3800 × 6 × 3/100)
= $3800 + (22800 × 3/100)
= $3800 + (68400/100)
= $3800 + $684 = $4484
Thus, Amount (A) to be paid = $4484 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $3800, the simple interest in 1 year
= 6/100 × 3800
= 6 × 3800/100
= 22800/100 = $228
Thus, simple interest for 1 year = $228
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $228 × 3 = $684
Thus, Simple Interest (SI) = $684
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $684
= $4484
Thus, Amount to be paid = $4484 Answer
Similar Questions
(1) If Christopher borrowed $4000 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(2) Find the amount to be paid if Susan borrowed a sum of $5650 at 9% simple interest for 8 years.
(3) How much loan did Linda borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5885 to clear it?
(4) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 3% simple interest.
(5) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $10600 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 5% simple interest.
(7) Find the amount to be paid if Mary borrowed a sum of $5050 at 8% simple interest for 7 years.
(8) Barbara took a loan of $5100 at the rate of 6% simple interest per annum. If he paid an amount of $6936 to clear the loan, then find the time period of the loan.
(9) Mary took a loan of $4100 at the rate of 8% simple interest per annum. If he paid an amount of $7380 to clear the loan, then find the time period of the loan.
(10) How much loan did Sarah borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7020 to clear it?