Question:
Calculate the amount due if William borrowed a sum of $3500 at 9% simple interest for 3 years.
Correct Answer
$4445
Solution And Explanation
Solution
Given,
Principal (P) = $3500
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) = $3500 × 9% × 3
= $3500 ×9/100 × 3
= 3500 × 9 × 3/100
= 31500 × 3/100
= 94500/100
= $945
Thus, Simple Interest = $945
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 = $3500 + $945
= $4445
Thus, Amount to be paid = $4445 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 = $3500
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 3 years
Thus, Amount (A)
= $3500 + ($3500 × 9% × 3)
= $3500 + ($3500 ×9/100 × 3)
= $3500 + (3500 × 9 × 3/100)
= $3500 + (31500 × 3/100)
= $3500 + (94500/100)
= $3500 + $945 = $4445
Thus, Amount (A) to be paid = $4445 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 $3500, the simple interest in 1 year
= 9/100 × 3500
= 9 × 3500/100
= 31500/100 = $315
Thus, simple interest for 1 year = $315
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $315 × 3 = $945
Thus, Simple Interest (SI) = $945
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3500 + $945
= $4445
Thus, Amount to be paid = $4445 Answer
Similar Questions
(1) Patricia took a loan of $4300 at the rate of 8% simple interest per annum. If he paid an amount of $7740 to clear the loan, then find the time period of the loan.
(2) Find the amount to be paid if Linda borrowed a sum of $5350 at 3% simple interest for 8 years.
(3) Calculate the amount due if Michael borrowed a sum of $3300 at 7% simple interest for 3 years.
(4) Calculate the amount due if Christopher borrowed a sum of $4000 at 9% simple interest for 4 years.
(5) In how much time a principal of $3200 will amount to $3456 at a simple interest of 4% per annum?
(6) Daniel had to pay $4346 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(7) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $8869 to clear the loan, then find the time period of the loan.
(8) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 7% simple interest?
(9) Find the amount to be paid if James borrowed a sum of $5000 at 10% simple interest for 8 years.
(10) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $8639 to clear the loan, then find the time period of the loan.