Question:
Calculate the amount due if Thomas borrowed a sum of $3800 at 9% simple interest for 3 years.
Correct Answer
$4826
Solution And Explanation
Solution
Given,
Principal (P) = $3800
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) = $3800 × 9% × 3
= $3800 ×9/100 × 3
= 3800 × 9 × 3/100
= 34200 × 3/100
= 102600/100
= $1026
Thus, Simple Interest = $1026
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 = $3800 + $1026
= $4826
Thus, Amount to be paid = $4826 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 = $3800
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 3 years
Thus, Amount (A)
= $3800 + ($3800 × 9% × 3)
= $3800 + ($3800 ×9/100 × 3)
= $3800 + (3800 × 9 × 3/100)
= $3800 + (34200 × 3/100)
= $3800 + (102600/100)
= $3800 + $1026 = $4826
Thus, Amount (A) to be paid = $4826 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 $3800, the simple interest in 1 year
= 9/100 × 3800
= 9 × 3800/100
= 34200/100 = $342
Thus, simple interest for 1 year = $342
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $342 × 3 = $1026
Thus, Simple Interest (SI) = $1026
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $1026
= $4826
Thus, Amount to be paid = $4826 Answer
Similar Questions
(1) Nancy took a loan of $6300 at the rate of 9% simple interest per annum. If he paid an amount of $10269 to clear the loan, then find the time period of the loan.
(2) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 5% simple interest?
(3) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $5920 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due if Susan borrowed a sum of $3650 at 2% simple interest for 3 years.
(5) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 6% simple interest?
(6) Sandra took a loan of $6900 at the rate of 6% simple interest per annum. If he paid an amount of $11040 to clear the loan, then find the time period of the loan.
(7) How much loan did Stephanie borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8305 to clear it?
(8) What amount does William have to pay after 6 years if he takes a loan of $3500 at 6% simple interest?
(9) If Joseph paid $4440 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(10) What amount will be due after 2 years if Mark borrowed a sum of $3700 at a 10% simple interest?