Question:
Calculate the amount due if Susan borrowed a sum of $3650 at 2% simple interest for 4 years.
Correct Answer
$3942
Solution And Explanation
Solution
Given,
Principal (P) = $3650
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) = $3650 × 2% × 4
= $3650 ×2/100 × 4
= 3650 × 2 × 4/100
= 7300 × 4/100
= 29200/100
= $292
Thus, Simple Interest = $292
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 + $292
= $3942
Thus, Amount to be paid = $3942 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) = 2%
And, Time (t) = 4 years
Thus, Amount (A)
= $3650 + ($3650 × 2% × 4)
= $3650 + ($3650 ×2/100 × 4)
= $3650 + (3650 × 2 × 4/100)
= $3650 + (7300 × 4/100)
= $3650 + (29200/100)
= $3650 + $292 = $3942
Thus, Amount (A) to be paid = $3942 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 $3650, the simple interest in 1 year
= 2/100 × 3650
= 2 × 3650/100
= 7300/100 = $73
Thus, simple interest for 1 year = $73
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $73 × 4 = $292
Thus, Simple Interest (SI) = $292
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $292
= $3942
Thus, Amount to be paid = $3942 Answer
Similar Questions
(1) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 5% simple interest?
(2) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 2% simple interest.
(3) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 4% simple interest.
(4) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $9900 to clear the loan, then find the time period of the loan.
(5) Find the amount to be paid if Patricia borrowed a sum of $5150 at 2% simple interest for 8 years.
(6) If Donna paid $5626 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(7) Find the amount to be paid if William borrowed a sum of $5500 at 3% simple interest for 8 years.
(8) Mark took a loan of $6800 at the rate of 8% simple interest per annum. If he paid an amount of $12240 to clear the loan, then find the time period of the loan.
(9) Nancy took a loan of $6300 at the rate of 7% simple interest per annum. If he paid an amount of $9828 to clear the loan, then find the time period of the loan.
(10) James took a loan of $4000 at the rate of 7% simple interest per annum. If he paid an amount of $6800 to clear the loan, then find the time period of the loan.