Question:
Calculate the amount due if Mary borrowed a sum of $3050 at 3% simple interest for 4 years.
Correct Answer
$3416
Solution And Explanation
Solution
Given,
Principal (P) = $3050
Rate of Simple Interest (SI) = 3%
Time (t) = 4 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $3050 × 3% × 4
= $3050 ×3/100 × 4
= 3050 × 3 × 4/100
= 9150 × 4/100
= 36600/100
= $366
Thus, Simple Interest = $366
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 = $3050 + $366
= $3416
Thus, Amount to be paid = $3416 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 = $3050
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 4 years
Thus, Amount (A)
= $3050 + ($3050 × 3% × 4)
= $3050 + ($3050 ×3/100 × 4)
= $3050 + (3050 × 3 × 4/100)
= $3050 + (9150 × 4/100)
= $3050 + (36600/100)
= $3050 + $366 = $3416
Thus, Amount (A) to be paid = $3416 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $3050, the simple interest in 1 year
= 3/100 × 3050
= 3 × 3050/100
= 9150/100 = $91.5
Thus, simple interest for 1 year = $91.5
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $91.5 × 4 = $366
Thus, Simple Interest (SI) = $366
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3050 + $366
= $3416
Thus, Amount to be paid = $3416 Answer
Similar Questions
(1) What amount will be due after 2 years if John borrowed a sum of $3100 at a 7% simple interest?
(2) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 3% simple interest for 7 years.
(3) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 4% simple interest.
(4) Calculate the amount due if David borrowed a sum of $3400 at 7% simple interest for 3 years.
(5) What amount does James have to pay after 5 years if he takes a loan of $3000 at 4% simple interest?
(6) Calculate the amount due if Barbara borrowed a sum of $3550 at 4% simple interest for 4 years.
(7) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 8% simple interest.
(8) 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.
(9) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 6% simple interest?
(10) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $8360 to clear the loan, then find the time period of the loan.