Question:
Calculate the amount due if Linda borrowed a sum of $3350 at 10% simple interest for 3 years.
Correct Answer
$4355
Solution And Explanation
Solution
Given,
Principal (P) = $3350
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) = $3350 × 10% × 3
= $3350 ×10/100 × 3
= 3350 × 10 × 3/100
= 33500 × 3/100
= 100500/100
= $1005
Thus, Simple Interest = $1005
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 = $3350 + $1005
= $4355
Thus, Amount to be paid = $4355 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 = $3350
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 3 years
Thus, Amount (A)
= $3350 + ($3350 × 10% × 3)
= $3350 + ($3350 ×10/100 × 3)
= $3350 + (3350 × 10 × 3/100)
= $3350 + (33500 × 3/100)
= $3350 + (100500/100)
= $3350 + $1005 = $4355
Thus, Amount (A) to be paid = $4355 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 $3350, the simple interest in 1 year
= 10/100 × 3350
= 10 × 3350/100
= 33500/100 = $335
Thus, simple interest for 1 year = $335
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $335 × 3 = $1005
Thus, Simple Interest (SI) = $1005
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3350 + $1005
= $4355
Thus, Amount to be paid = $4355 Answer
Similar Questions
(1) Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $9620 to clear the loan, then find the time period of the loan.
(2) How much loan did Sharon borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8525 to clear it?
(3) Matthew took a loan of $6400 at the rate of 9% simple interest per annum. If he paid an amount of $11584 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if James borrowed a sum of $5000 at 8% simple interest for 8 years.
(5) How much loan did Matthew borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6820 to clear it?
(6) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 7% simple interest?
(7) Find the amount to be paid if David borrowed a sum of $5400 at 5% simple interest for 8 years.
(8) Calculate the amount due if Thomas borrowed a sum of $3800 at 4% simple interest for 4 years.
(9) Donald had to pay $5175 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(10) Patricia took a loan of $4300 at the rate of 6% simple interest per annum. If he paid an amount of $5848 to clear the loan, then find the time period of the loan.