Question:
Calculate the amount due if Joseph borrowed a sum of $3700 at 10% simple interest for 3 years.
Correct Answer
$4810
Solution And Explanation
Solution
Given,
Principal (P) = $3700
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) = $3700 × 10% × 3
= $3700 ×10/100 × 3
= 3700 × 10 × 3/100
= 37000 × 3/100
= 111000/100
= $1110
Thus, Simple Interest = $1110
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 = $3700 + $1110
= $4810
Thus, Amount to be paid = $4810 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 = $3700
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 3 years
Thus, Amount (A)
= $3700 + ($3700 × 10% × 3)
= $3700 + ($3700 ×10/100 × 3)
= $3700 + (3700 × 10 × 3/100)
= $3700 + (37000 × 3/100)
= $3700 + (111000/100)
= $3700 + $1110 = $4810
Thus, Amount (A) to be paid = $4810 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 $3700, the simple interest in 1 year
= 10/100 × 3700
= 10 × 3700/100
= 37000/100 = $370
Thus, simple interest for 1 year = $370
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $370 × 3 = $1110
Thus, Simple Interest (SI) = $1110
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3700 + $1110
= $4810
Thus, Amount to be paid = $4810 Answer
Similar Questions
(1) Find the amount to be paid if Richard borrowed a sum of $5600 at 10% simple interest for 7 years.
(2) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 4% simple interest for 4 years.
(3) Find the amount to be paid if Sarah borrowed a sum of $5850 at 5% simple interest for 7 years.
(4) In how much time a principal of $3100 will amount to $3224 at a simple interest of 2% per annum?
(5) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 4% simple interest?
(6) Sandra took a loan of $6900 at the rate of 10% simple interest per annum. If he paid an amount of $13110 to clear the loan, then find the time period of the loan.
(7) Mary took a loan of $4100 at the rate of 10% simple interest per annum. If he paid an amount of $7380 to clear the loan, then find the time period of the loan.
(8) Michael took a loan of $4600 at the rate of 8% simple interest per annum. If he paid an amount of $8280 to clear the loan, then find the time period of the loan.
(9) What amount does David have to pay after 5 years if he takes a loan of $3400 at 10% simple interest?
(10) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 6% simple interest?