Question:
Calculate the amount due if Richard borrowed a sum of $3600 at 9% simple interest for 3 years.
Correct Answer
$4572
Solution And Explanation
Solution
Given,
Principal (P) = $3600
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) = $3600 × 9% × 3
= $3600 ×9/100 × 3
= 3600 × 9 × 3/100
= 32400 × 3/100
= 97200/100
= $972
Thus, Simple Interest = $972
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 = $3600 + $972
= $4572
Thus, Amount to be paid = $4572 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 = $3600
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 3 years
Thus, Amount (A)
= $3600 + ($3600 × 9% × 3)
= $3600 + ($3600 ×9/100 × 3)
= $3600 + (3600 × 9 × 3/100)
= $3600 + (32400 × 3/100)
= $3600 + (97200/100)
= $3600 + $972 = $4572
Thus, Amount (A) to be paid = $4572 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 $3600, the simple interest in 1 year
= 9/100 × 3600
= 9 × 3600/100
= 32400/100 = $324
Thus, simple interest for 1 year = $324
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $324 × 3 = $972
Thus, Simple Interest (SI) = $972
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3600 + $972
= $4572
Thus, Amount to be paid = $4572 Answer
Similar Questions
(1) What amount does John have to pay after 5 years if he takes a loan of $3200 at 3% simple interest?
(2) If Jessica borrowed $3750 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(3) How much loan did Andrew borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8160 to clear it?
(4) Karen took a loan of $5900 at the rate of 9% simple interest per annum. If he paid an amount of $10148 to clear the loan, then find the time period of the loan.
(5) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $10106 to clear the loan, then find the time period of the loan.
(6) Daniel took a loan of $6200 at the rate of 10% simple interest per annum. If he paid an amount of $12400 to clear the loan, then find the time period of the loan.
(7) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 10% simple interest?
(8) How much loan did David borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6480 to clear it?
(9) Michael took a loan of $4600 at the rate of 9% simple interest per annum. If he paid an amount of $7498 to clear the loan, then find the time period of the loan.
(10) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $9310 to clear the loan, then find the time period of the loan.