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) What amount does John have to pay after 5 years if he takes a loan of $3200 at 8% simple interest?
(2) Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $11200 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Michael borrowed a sum of $5300 at 8% simple interest for 8 years.
(4) Find the amount to be paid if Jessica borrowed a sum of $5750 at 9% simple interest for 8 years.
(5) Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $8568 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due if Joseph borrowed a sum of $3700 at 4% simple interest for 3 years.
(7) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 10% simple interest.
(8) What amount will be due after 2 years if Christopher borrowed a sum of $3500 at a 8% simple interest?
(9) If William paid $4060 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(10) What amount does Karen have to pay after 5 years if he takes a loan of $3950 at 3% simple interest?