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) Jessica took a loan of $5500 at the rate of 9% simple interest per annum. If he paid an amount of $9955 to clear the loan, then find the time period of the loan.
(2) What amount will be due after 2 years if Charles borrowed a sum of $3450 at a 4% simple interest?
(3) Calculate the amount due if John borrowed a sum of $3200 at 7% simple interest for 4 years.
(4) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 8% simple interest?
(5) Calculate the amount due after 9 years if David borrowed a sum of $5400 at a rate of 7% simple interest.
(6) How much loan did David borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6210 to clear it?
(7) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7647.5 to clear it?
(8) Linda took a loan of $4700 at the rate of 8% simple interest per annum. If he paid an amount of $7332 to clear the loan, then find the time period of the loan.
(9) How much loan did Ronald borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9000 to clear it?
(10) Barbara took a loan of $5100 at the rate of 9% simple interest per annum. If he paid an amount of $8772 to clear the loan, then find the time period of the loan.