Question:
Calculate the amount due if Robert borrowed a sum of $3100 at 6% simple interest for 4 years.
Correct Answer
$3844
Solution And Explanation
Solution
Given,
Principal (P) = $3100
Rate of Simple Interest (SI) = 6%
Time (t) = 4 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $3100 × 6% × 4
= $3100 ×6/100 × 4
= 3100 × 6 × 4/100
= 18600 × 4/100
= 74400/100
= $744
Thus, Simple Interest = $744
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 = $3100 + $744
= $3844
Thus, Amount to be paid = $3844 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 = $3100
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 4 years
Thus, Amount (A)
= $3100 + ($3100 × 6% × 4)
= $3100 + ($3100 ×6/100 × 4)
= $3100 + (3100 × 6 × 4/100)
= $3100 + (18600 × 4/100)
= $3100 + (74400/100)
= $3100 + $744 = $3844
Thus, Amount (A) to be paid = $3844 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $3100, the simple interest in 1 year
= 6/100 × 3100
= 6 × 3100/100
= 18600/100 = $186
Thus, simple interest for 1 year = $186
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $186 × 4 = $744
Thus, Simple Interest (SI) = $744
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3100 + $744
= $3844
Thus, Amount to be paid = $3844 Answer
Similar Questions
(1) How much loan did Carol borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7755 to clear it?
(2) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 10% simple interest?
(3) Calculate the amount due if Mary borrowed a sum of $3050 at 9% simple interest for 4 years.
(4) Calculate the amount due if James borrowed a sum of $3000 at 10% simple interest for 3 years.
(5) Find the amount to be paid if Mary borrowed a sum of $5050 at 7% simple interest for 7 years.
(6) Calculate the amount due if William borrowed a sum of $3500 at 2% simple interest for 4 years.
(7) Susan took a loan of $5300 at the rate of 9% simple interest per annum. If he paid an amount of $8639 to clear the loan, then find the time period of the loan.
(8) Find the amount to be paid if David borrowed a sum of $5400 at 4% simple interest for 8 years.
(9) Find the amount to be paid if Barbara borrowed a sum of $5550 at 9% simple interest for 7 years.
(10) Donald took a loan of $7000 at the rate of 7% simple interest per annum. If he paid an amount of $10430 to clear the loan, then find the time period of the loan.