Question:
Calculate the amount due if Susan borrowed a sum of $3650 at 7% simple interest for 3 years.
Correct Answer
$4416.5
Solution And Explanation
Solution
Given,
Principal (P) = $3650
Rate of Simple Interest (SI) = 7%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $3650 × 7% × 3
= $3650 ×7/100 × 3
= 3650 × 7 × 3/100
= 25550 × 3/100
= 76650/100
= $766.5
Thus, Simple Interest = $766.5
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 = $3650 + $766.5
= $4416.5
Thus, Amount to be paid = $4416.5 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 = $3650
Rate of Simple Interest (SI) or (R) = 7%
And, Time (t) = 3 years
Thus, Amount (A)
= $3650 + ($3650 × 7% × 3)
= $3650 + ($3650 ×7/100 × 3)
= $3650 + (3650 × 7 × 3/100)
= $3650 + (25550 × 3/100)
= $3650 + (76650/100)
= $3650 + $766.5 = $4416.5
Thus, Amount (A) to be paid = $4416.5 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 7%
This, means, $7 per $100 per year
∵ For $100, the simple interest for 1 year = $7
∴ For $1, the simple interest for 1 year = 7/100
∴ For $3650, the simple interest in 1 year
= 7/100 × 3650
= 7 × 3650/100
= 25550/100 = $255.5
Thus, simple interest for 1 year = $255.5
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $255.5 × 3 = $766.5
Thus, Simple Interest (SI) = $766.5
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $766.5
= $4416.5
Thus, Amount to be paid = $4416.5 Answer
Similar Questions
(1) Calculate the amount due if Joseph borrowed a sum of $3700 at 2% simple interest for 3 years.
(2) Matthew had to pay $4578 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(3) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 2% simple interest.
(4) What amount will be due after 2 years if Joshua borrowed a sum of $3950 at a 6% simple interest?
(5) Barbara had to pay $3763 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(6) Find the amount to be paid if Mary borrowed a sum of $5050 at 6% simple interest for 7 years.
(7) Anthony took a loan of $6600 at the rate of 7% simple interest per annum. If he paid an amount of $10296 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if Charles borrowed a sum of $3900 at 5% simple interest for 4 years.
(9) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $7480 to clear the loan, then find the time period of the loan.
(10) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 4% simple interest?