Question:
Calculate the amount due if Michael borrowed a sum of $3300 at 2% simple interest for 4 years.
Correct Answer
$3564
Solution And Explanation
Solution
Given,
Principal (P) = $3300
Rate of Simple Interest (SI) = 2%
Time (t) = 4 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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 × 2% × 4
= $3300 ×2/100 × 4
= 3300 × 2 × 4/100
= 6600 × 4/100
= 26400/100
= $264
Thus, Simple Interest = $264
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 + $264
= $3564
Thus, Amount to be paid = $3564 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) = 2%
And, Time (t) = 4 years
Thus, Amount (A)
= $3300 + ($3300 × 2% × 4)
= $3300 + ($3300 ×2/100 × 4)
= $3300 + (3300 × 2 × 4/100)
= $3300 + (6600 × 4/100)
= $3300 + (26400/100)
= $3300 + $264 = $3564
Thus, Amount (A) to be paid = $3564 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 2%
This, means, $2 per $100 per year
∵ For $100, the simple interest for 1 year = $2
∴ For $1, the simple interest for 1 year = 2/100
∴ For $3300, the simple interest in 1 year
= 2/100 × 3300
= 2 × 3300/100
= 6600/100 = $66
Thus, simple interest for 1 year = $66
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $66 × 4 = $264
Thus, Simple Interest (SI) = $264
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $264
= $3564
Thus, Amount to be paid = $3564 Answer
Similar Questions
(1) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 10% simple interest?
(2) Donald took a loan of $7000 at the rate of 6% simple interest per annum. If he paid an amount of $9940 to clear the loan, then find the time period of the loan.
(3) Margaret took a loan of $6700 at the rate of 10% simple interest per annum. If he paid an amount of $12060 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due if James borrowed a sum of $3000 at 4% simple interest for 3 years.
(5) Calculate the amount due if Thomas borrowed a sum of $3800 at 10% simple interest for 3 years.
(6) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $11222 to clear the loan, then find the time period of the loan.
(7) Find the amount to be paid if Linda borrowed a sum of $5350 at 7% simple interest for 7 years.
(8) Find the amount to be paid if Karen borrowed a sum of $5950 at 8% simple interest for 7 years.
(9) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 6% simple interest.
(10) If John borrowed $3200 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.