Question:
Calculate the amount due if Michael borrowed a sum of $3300 at 5% simple interest for 4 years.
Correct Answer
$3960
Solution And Explanation
Solution
Given,
Principal (P) = $3300
Rate of Simple Interest (SI) = 5%
Time (t) = 4 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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 × 5% × 4
= $3300 ×5/100 × 4
= 3300 × 5 × 4/100
= 16500 × 4/100
= 66000/100
= $660
Thus, Simple Interest = $660
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 + $660
= $3960
Thus, Amount to be paid = $3960 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) = 5%
And, Time (t) = 4 years
Thus, Amount (A)
= $3300 + ($3300 × 5% × 4)
= $3300 + ($3300 ×5/100 × 4)
= $3300 + (3300 × 5 × 4/100)
= $3300 + (16500 × 4/100)
= $3300 + (66000/100)
= $3300 + $660 = $3960
Thus, Amount (A) to be paid = $3960 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 5%
This, means, $5 per $100 per year
∵ For $100, the simple interest for 1 year = $5
∴ For $1, the simple interest for 1 year = 5/100
∴ For $3300, the simple interest in 1 year
= 5/100 × 3300
= 5 × 3300/100
= 16500/100 = $165
Thus, simple interest for 1 year = $165
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $165 × 4 = $660
Thus, Simple Interest (SI) = $660
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $660
= $3960
Thus, Amount to be paid = $3960 Answer
Similar Questions
(1) If Charles borrowed $3900 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(2) Richard took a loan of $5200 at the rate of 9% simple interest per annum. If he paid an amount of $9880 to clear the loan, then find the time period of the loan.
(3) Calculate the amount due after 9 years if Charles borrowed a sum of $5900 at a rate of 3% simple interest.
(4) Find the amount to be paid if James borrowed a sum of $5000 at 5% simple interest for 7 years.
(5) How much loan did Jacob borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9600 to clear it?
(6) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 7% simple interest?
(7) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 3% simple interest.
(8) Matthew took a loan of $6400 at the rate of 9% simple interest per annum. If he paid an amount of $12160 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due after 10 years if William borrowed a sum of $5500 at a rate of 10% simple interest.
(10) In how much time a principal of $3000 will amount to $3600 at a simple interest of 4% per annum?