Question:
Calculate the amount due if Charles borrowed a sum of $3900 at 6% simple interest for 3 years.
Correct Answer
$4602
Solution And Explanation
Solution
Given,
Principal (P) = $3900
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) = $3900 × 6% × 3
= $3900 ×6/100 × 3
= 3900 × 6 × 3/100
= 23400 × 3/100
= 70200/100
= $702
Thus, Simple Interest = $702
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 = $3900 + $702
= $4602
Thus, Amount to be paid = $4602 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 = $3900
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 3 years
Thus, Amount (A)
= $3900 + ($3900 × 6% × 3)
= $3900 + ($3900 ×6/100 × 3)
= $3900 + (3900 × 6 × 3/100)
= $3900 + (23400 × 3/100)
= $3900 + (70200/100)
= $3900 + $702 = $4602
Thus, Amount (A) to be paid = $4602 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 $3900, the simple interest in 1 year
= 6/100 × 3900
= 6 × 3900/100
= 23400/100 = $234
Thus, simple interest for 1 year = $234
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $234 × 3 = $702
Thus, Simple Interest (SI) = $702
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3900 + $702
= $4602
Thus, Amount to be paid = $4602 Answer
Similar Questions
(1) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 8% simple interest?
(2) In how much time a principal of $3150 will amount to $3780 at a simple interest of 5% per annum?
(3) How much loan did Dorothy borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7975 to clear it?
(4) Thomas took a loan of $5600 at the rate of 9% simple interest per annum. If he paid an amount of $9128 to clear the loan, then find the time period of the loan.
(5) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 9% simple interest?
(6) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 8% simple interest.
(7) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 10% simple interest for 3 years.
(8) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 3% simple interest.
(9) Calculate the amount due if Robert borrowed a sum of $3100 at 6% simple interest for 4 years.
(10) What amount will be due after 2 years if Paul borrowed a sum of $3850 at a 7% simple interest?