Question:
Calculate the amount due if John borrowed a sum of $3200 at 9% simple interest for 3 years.
Correct Answer
$4064
Solution And Explanation
Solution
Given,
Principal (P) = $3200
Rate of Simple Interest (SI) = 9%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $3200 × 9% × 3
= $3200 ×9/100 × 3
= 3200 × 9 × 3/100
= 28800 × 3/100
= 86400/100
= $864
Thus, Simple Interest = $864
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 = $3200 + $864
= $4064
Thus, Amount to be paid = $4064 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 = $3200
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 3 years
Thus, Amount (A)
= $3200 + ($3200 × 9% × 3)
= $3200 + ($3200 ×9/100 × 3)
= $3200 + (3200 × 9 × 3/100)
= $3200 + (28800 × 3/100)
= $3200 + (86400/100)
= $3200 + $864 = $4064
Thus, Amount (A) to be paid = $4064 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $3200, the simple interest in 1 year
= 9/100 × 3200
= 9 × 3200/100
= 28800/100 = $288
Thus, simple interest for 1 year = $288
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $288 × 3 = $864
Thus, Simple Interest (SI) = $864
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3200 + $864
= $4064
Thus, Amount to be paid = $4064 Answer
Similar Questions
(1) How much loan did Elizabeth borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5995 to clear it?
(2) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 5% simple interest?
(3) Elizabeth took a loan of $4900 at the rate of 7% simple interest per annum. If he paid an amount of $7644 to clear the loan, then find the time period of the loan.
(4) Lisa took a loan of $6100 at the rate of 10% simple interest per annum. If he paid an amount of $10370 to clear the loan, then find the time period of the loan.
(5) Find the amount to be paid if Patricia borrowed a sum of $5150 at 6% simple interest for 7 years.
(6) Calculate the amount due if Charles borrowed a sum of $3900 at 4% simple interest for 3 years.
(7) Michael took a loan of $4600 at the rate of 9% simple interest per annum. If he paid an amount of $7084 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if Barbara borrowed a sum of $3550 at 6% simple interest for 4 years.
(9) Richard took a loan of $5200 at the rate of 9% simple interest per annum. If he paid an amount of $8944 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 8% simple interest.