Question:
Calculate the amount due if Charles borrowed a sum of $3900 at 9% simple interest for 3 years.
Correct Answer
$4953
Solution And Explanation
Solution
Given,
Principal (P) = $3900
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) = $3900 × 9% × 3
= $3900 ×9/100 × 3
= 3900 × 9 × 3/100
= 35100 × 3/100
= 105300/100
= $1053
Thus, Simple Interest = $1053
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 = $3900 + $1053
= $4953
Thus, Amount to be paid = $4953 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 = $3900
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 3 years
Thus, Amount (A)
= $3900 + ($3900 × 9% × 3)
= $3900 + ($3900 ×9/100 × 3)
= $3900 + (3900 × 9 × 3/100)
= $3900 + (35100 × 3/100)
= $3900 + (105300/100)
= $3900 + $1053 = $4953
Thus, Amount (A) to be paid = $4953 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 $3900, the simple interest in 1 year
= 9/100 × 3900
= 9 × 3900/100
= 35100/100 = $351
Thus, simple interest for 1 year = $351
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $351 × 3 = $1053
Thus, Simple Interest (SI) = $1053
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3900 + $1053
= $4953
Thus, Amount to be paid = $4953 Answer
Similar Questions
(1) Donald took a loan of $7000 at the rate of 8% simple interest per annum. If he paid an amount of $11480 to clear the loan, then find the time period of the loan.
(2) How much loan did Amanda borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8580 to clear it?
(3) Find the amount to be paid if James borrowed a sum of $5000 at 5% simple interest for 8 years.
(4) Calculate the amount due if Michael borrowed a sum of $3300 at 2% simple interest for 4 years.
(5) What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 8% simple interest?
(6) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 9% simple interest.
(7) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 7% simple interest?
(8) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 8% simple interest.
(9) If Jennifer borrowed $3250 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(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.