Question:
Calculate the amount due if Jennifer borrowed a sum of $3250 at 9% simple interest for 3 years.
Correct Answer
$4127.5
Solution And Explanation
Solution
Given,
Principal (P) = $3250
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) = $3250 × 9% × 3
= $3250 ×9/100 × 3
= 3250 × 9 × 3/100
= 29250 × 3/100
= 87750/100
= $877.5
Thus, Simple Interest = $877.5
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 = $3250 + $877.5
= $4127.5
Thus, Amount to be paid = $4127.5 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 = $3250
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 3 years
Thus, Amount (A)
= $3250 + ($3250 × 9% × 3)
= $3250 + ($3250 ×9/100 × 3)
= $3250 + (3250 × 9 × 3/100)
= $3250 + (29250 × 3/100)
= $3250 + (87750/100)
= $3250 + $877.5 = $4127.5
Thus, Amount (A) to be paid = $4127.5 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 $3250, the simple interest in 1 year
= 9/100 × 3250
= 9 × 3250/100
= 29250/100 = $292.5
Thus, simple interest for 1 year = $292.5
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $292.5 × 3 = $877.5
Thus, Simple Interest (SI) = $877.5
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3250 + $877.5
= $4127.5
Thus, Amount to be paid = $4127.5 Answer
Similar Questions
(1) Find the amount to be paid if Michael borrowed a sum of $5300 at 2% simple interest for 8 years.
(2) If Christopher paid $4480 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(3) Michael had to pay $3795 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(4) Calculate the amount due if Jessica borrowed a sum of $3750 at 5% simple interest for 3 years.
(5) Christopher had to pay $4240 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(6) 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.
(7) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 4% simple interest?
(8) Calculate the amount due if John borrowed a sum of $3200 at 3% simple interest for 4 years.
(9) Find the amount to be paid if Mary borrowed a sum of $5050 at 2% simple interest for 7 years.
(10) William took a loan of $5000 at the rate of 9% simple interest per annum. If he paid an amount of $8600 to clear the loan, then find the time period of the loan.