Question:
Calculate the amount due if Michael borrowed a sum of $3300 at 4% simple interest for 4 years.
Correct Answer
$3828
Solution And Explanation
Solution
Given,
Principal (P) = $3300
Rate of Simple Interest (SI) = 4%
Time (t) = 4 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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 × 4% × 4
= $3300 ×4/100 × 4
= 3300 × 4 × 4/100
= 13200 × 4/100
= 52800/100
= $528
Thus, Simple Interest = $528
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 + $528
= $3828
Thus, Amount to be paid = $3828 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) = 4%
And, Time (t) = 4 years
Thus, Amount (A)
= $3300 + ($3300 × 4% × 4)
= $3300 + ($3300 ×4/100 × 4)
= $3300 + (3300 × 4 × 4/100)
= $3300 + (13200 × 4/100)
= $3300 + (52800/100)
= $3300 + $528 = $3828
Thus, Amount (A) to be paid = $3828 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 4%
This, means, $4 per $100 per year
∵ For $100, the simple interest for 1 year = $4
∴ For $1, the simple interest for 1 year = 4/100
∴ For $3300, the simple interest in 1 year
= 4/100 × 3300
= 4 × 3300/100
= 13200/100 = $132
Thus, simple interest for 1 year = $132
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $132 × 4 = $528
Thus, Simple Interest (SI) = $528
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $528
= $3828
Thus, Amount to be paid = $3828 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 10% simple interest.
(2) Elizabeth took a loan of $4900 at the rate of 10% simple interest per annum. If he paid an amount of $7840 to clear the loan, then find the time period of the loan.
(3) Patricia took a loan of $4300 at the rate of 7% simple interest per annum. If he paid an amount of $6708 to clear the loan, then find the time period of the loan.
(4) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 3% simple interest?
(5) John took a loan of $4400 at the rate of 8% simple interest per annum. If he paid an amount of $6864 to clear the loan, then find the time period of the loan.
(6) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 8% simple interest?
(7) Lisa took a loan of $6100 at the rate of 9% simple interest per annum. If he paid an amount of $11590 to clear the loan, then find the time period of the loan.
(8) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 8% simple interest?
(9) If Kenneth paid $6000 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(10) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $7560 to clear the loan, then find the time period of the loan.