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) What amount does David have to pay after 6 years if he takes a loan of $3400 at 5% simple interest?
(2) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 2% simple interest.
(3) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 4% simple interest.
(4) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 6% simple interest?
(5) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 2% simple interest for 7 years.
(6) How much loan did Kevin borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8165 to clear it?
(7) Calculate the amount due if Joseph borrowed a sum of $3700 at 6% simple interest for 4 years.
(8) Matthew took a loan of $6400 at the rate of 6% simple interest per annum. If he paid an amount of $9088 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 5% simple interest.
(10) If Margaret paid $4698 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.