Question:
Calculate the amount due if Susan borrowed a sum of $3650 at 10% simple interest for 3 years.
Correct Answer
$4745
Solution And Explanation
Solution
Given,
Principal (P) = $3650
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) = $3650 × 10% × 3
= $3650 ×10/100 × 3
= 3650 × 10 × 3/100
= 36500 × 3/100
= 109500/100
= $1095
Thus, Simple Interest = $1095
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 = $3650 + $1095
= $4745
Thus, Amount to be paid = $4745 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 = $3650
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 3 years
Thus, Amount (A)
= $3650 + ($3650 × 10% × 3)
= $3650 + ($3650 ×10/100 × 3)
= $3650 + (3650 × 10 × 3/100)
= $3650 + (36500 × 3/100)
= $3650 + (109500/100)
= $3650 + $1095 = $4745
Thus, Amount (A) to be paid = $4745 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 $3650, the simple interest in 1 year
= 10/100 × 3650
= 10 × 3650/100
= 36500/100 = $365
Thus, simple interest for 1 year = $365
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $365 × 3 = $1095
Thus, Simple Interest (SI) = $1095
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $1095
= $4745
Thus, Amount to be paid = $4745 Answer
Similar Questions
(1) Calculate the amount due if Karen borrowed a sum of $3950 at 3% simple interest for 4 years.
(2) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $11524 to clear the loan, then find the time period of the loan.
(3) Betty took a loan of $6500 at the rate of 10% simple interest per annum. If he paid an amount of $11050 to clear the loan, then find the time period of the loan.
(4) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 10% simple interest?
(5) Calculate the amount due if Karen borrowed a sum of $3950 at 5% simple interest for 3 years.
(6) If Mary paid $3660 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(7) Find the amount to be paid if Richard borrowed a sum of $5600 at 3% simple interest for 8 years.
(8) If Mary borrowed $3050 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(9) What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 3% simple interest?
(10) What amount does Jessica have to pay after 5 years if he takes a loan of $3750 at 2% simple interest?