Question:
Calculate the amount due if Michael borrowed a sum of $3300 at 10% simple interest for 3 years.
Correct Answer
$4290
Solution And Explanation
Solution
Given,
Principal (P) = $3300
Rate of Simple Interest (SI) = 10%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $3300 × 10% × 3
= $3300 ×10/100 × 3
= 3300 × 10 × 3/100
= 33000 × 3/100
= 99000/100
= $990
Thus, Simple Interest = $990
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 = $3300 + $990
= $4290
Thus, Amount to be paid = $4290 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 = $3300
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 3 years
Thus, Amount (A)
= $3300 + ($3300 × 10% × 3)
= $3300 + ($3300 ×10/100 × 3)
= $3300 + (3300 × 10 × 3/100)
= $3300 + (33000 × 3/100)
= $3300 + (99000/100)
= $3300 + $990 = $4290
Thus, Amount (A) to be paid = $4290 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 10%
This, means, $10 per $100 per year
∵ For $100, the simple interest for 1 year = $10
∴ For $1, the simple interest for 1 year = 10/100
∴ For $3300, the simple interest in 1 year
= 10/100 × 3300
= 10 × 3300/100
= 33000/100 = $330
Thus, simple interest for 1 year = $330
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $330 × 3 = $990
Thus, Simple Interest (SI) = $990
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $990
= $4290
Thus, Amount to be paid = $4290 Answer
Similar Questions
(1) Karen took a loan of $5900 at the rate of 6% simple interest per annum. If he paid an amount of $8732 to clear the loan, then find the time period of the loan.
(2) If John paid $3840 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(3) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $10452 to clear the loan, then find the time period of the loan.
(4) Christopher took a loan of $6000 at the rate of 6% simple interest per annum. If he paid an amount of $9600 to clear the loan, then find the time period of the loan.
(5) Mary took a loan of $4100 at the rate of 9% simple interest per annum. If he paid an amount of $7790 to clear the loan, then find the time period of the loan.
(6) Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $8946 to clear the loan, then find the time period of the loan.
(7) If Sarah borrowed $3850 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(8) What amount will be due after 2 years if Robert borrowed a sum of $3050 at a 6% simple interest?
(9) Matthew took a loan of $6400 at the rate of 7% simple interest per annum. If he paid an amount of $9536 to clear the loan, then find the time period of the loan.
(10) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $11880 to clear the loan, then find the time period of the loan.