Question:
Calculate the amount due if Thomas borrowed a sum of $3800 at 8% simple interest for 3 years.
Correct Answer
$4712
Solution And Explanation
Solution
Given,
Principal (P) = $3800
Rate of Simple Interest (SI) = 8%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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 × 8% × 3
= $3800 ×8/100 × 3
= 3800 × 8 × 3/100
= 30400 × 3/100
= 91200/100
= $912
Thus, Simple Interest = $912
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 + $912
= $4712
Thus, Amount to be paid = $4712 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) = 8%
And, Time (t) = 3 years
Thus, Amount (A)
= $3800 + ($3800 × 8% × 3)
= $3800 + ($3800 ×8/100 × 3)
= $3800 + (3800 × 8 × 3/100)
= $3800 + (30400 × 3/100)
= $3800 + (91200/100)
= $3800 + $912 = $4712
Thus, Amount (A) to be paid = $4712 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 8%
This, means, $8 per $100 per year
∵ For $100, the simple interest for 1 year = $8
∴ For $1, the simple interest for 1 year = 8/100
∴ For $3800, the simple interest in 1 year
= 8/100 × 3800
= 8 × 3800/100
= 30400/100 = $304
Thus, simple interest for 1 year = $304
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $304 × 3 = $912
Thus, Simple Interest (SI) = $912
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $912
= $4712
Thus, Amount to be paid = $4712 Answer
Similar Questions
(1) If Emily paid $5320 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(2) Linda took a loan of $4700 at the rate of 6% simple interest per annum. If he paid an amount of $6392 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Linda borrowed a sum of $5350 at 3% simple interest for 7 years.
(4) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 7% simple interest.
(5) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 9% simple interest.
(6) Find the amount to be paid if Linda borrowed a sum of $5350 at 4% simple interest for 8 years.
(7) Karen took a loan of $5900 at the rate of 10% simple interest per annum. If he paid an amount of $10030 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if Richard borrowed a sum of $3600 at 6% simple interest for 3 years.
(9) Linda had to pay $3651.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(10) What amount does David have to pay after 6 years if he takes a loan of $3400 at 9% simple interest?