Question:
Calculate the amount due if Thomas borrowed a sum of $3800 at 10% simple interest for 3 years.
Correct Answer
$4940
Solution And Explanation
Solution
Given,
Principal (P) = $3800
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) = $3800 × 10% × 3
= $3800 ×10/100 × 3
= 3800 × 10 × 3/100
= 38000 × 3/100
= 114000/100
= $1140
Thus, Simple Interest = $1140
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 = $3800 + $1140
= $4940
Thus, Amount to be paid = $4940 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 = $3800
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 3 years
Thus, Amount (A)
= $3800 + ($3800 × 10% × 3)
= $3800 + ($3800 ×10/100 × 3)
= $3800 + (3800 × 10 × 3/100)
= $3800 + (38000 × 3/100)
= $3800 + (114000/100)
= $3800 + $1140 = $4940
Thus, Amount (A) to be paid = $4940 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 $3800, the simple interest in 1 year
= 10/100 × 3800
= 10 × 3800/100
= 38000/100 = $380
Thus, simple interest for 1 year = $380
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $380 × 3 = $1140
Thus, Simple Interest (SI) = $1140
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $1140
= $4940
Thus, Amount to be paid = $4940 Answer
Similar Questions
(1) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $8639 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due if Linda borrowed a sum of $3350 at 6% simple interest for 4 years.
(3) In how much time a principal of $3050 will amount to $3660 at a simple interest of 5% per annum?
(4) How much loan did Michael borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6360 to clear it?
(5) Betty had to pay $4632.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(6) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 4% simple interest for 4 years.
(7) Find the amount to be paid if Thomas borrowed a sum of $5800 at 7% simple interest for 7 years.
(8) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 10% simple interest?
(9) Calculate the amount due if Jennifer borrowed a sum of $3250 at 3% simple interest for 4 years.
(10) If Sandra paid $5162 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.