Question:
Calculate the amount due if Jessica borrowed a sum of $3750 at 9% simple interest for 3 years.
Correct Answer
$4762.5
Solution And Explanation
Solution
Given,
Principal (P) = $3750
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) = $3750 × 9% × 3
= $3750 ×9/100 × 3
= 3750 × 9 × 3/100
= 33750 × 3/100
= 101250/100
= $1012.5
Thus, Simple Interest = $1012.5
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 = $3750 + $1012.5
= $4762.5
Thus, Amount to be paid = $4762.5 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 = $3750
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 3 years
Thus, Amount (A)
= $3750 + ($3750 × 9% × 3)
= $3750 + ($3750 ×9/100 × 3)
= $3750 + (3750 × 9 × 3/100)
= $3750 + (33750 × 3/100)
= $3750 + (101250/100)
= $3750 + $1012.5 = $4762.5
Thus, Amount (A) to be paid = $4762.5 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 $3750, the simple interest in 1 year
= 9/100 × 3750
= 9 × 3750/100
= 33750/100 = $337.5
Thus, simple interest for 1 year = $337.5
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $337.5 × 3 = $1012.5
Thus, Simple Interest (SI) = $1012.5
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3750 + $1012.5
= $4762.5
Thus, Amount to be paid = $4762.5 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 4% simple interest.
(2) Nancy took a loan of $6300 at the rate of 8% simple interest per annum. If he paid an amount of $11340 to clear the loan, then find the time period of the loan.
(3) Elizabeth took a loan of $4900 at the rate of 8% simple interest per annum. If he paid an amount of $7252 to clear the loan, then find the time period of the loan.
(4) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $10921 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 9% simple interest.
(6) Calculate the amount due if Barbara borrowed a sum of $3550 at 7% simple interest for 4 years.
(7) 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.
(8) If William borrowed $3500 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(9) Calculate the amount due if Mary borrowed a sum of $3050 at 3% simple interest for 4 years.
(10) If John paid $3712 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.