Question:
Calculate the amount due if John borrowed a sum of $3200 at 6% simple interest for 4 years.
Correct Answer
$3968
Solution And Explanation
Solution
Given,
Principal (P) = $3200
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) = $3200 × 6% × 4
= $3200 ×6/100 × 4
= 3200 × 6 × 4/100
= 19200 × 4/100
= 76800/100
= $768
Thus, Simple Interest = $768
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 = $3200 + $768
= $3968
Thus, Amount to be paid = $3968 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 = $3200
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 4 years
Thus, Amount (A)
= $3200 + ($3200 × 6% × 4)
= $3200 + ($3200 ×6/100 × 4)
= $3200 + (3200 × 6 × 4/100)
= $3200 + (19200 × 4/100)
= $3200 + (76800/100)
= $3200 + $768 = $3968
Thus, Amount (A) to be paid = $3968 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 $3200, the simple interest in 1 year
= 6/100 × 3200
= 6 × 3200/100
= 19200/100 = $192
Thus, simple interest for 1 year = $192
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $192 × 4 = $768
Thus, Simple Interest (SI) = $768
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3200 + $768
= $3968
Thus, Amount to be paid = $3968 Answer
Similar Questions
(1) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 2% simple interest.
(2) Calculate the amount due if James borrowed a sum of $3000 at 5% simple interest for 3 years.
(3) If John paid $3840 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(4) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 6% simple interest.
(5) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 7% simple interest?
(6) Elizabeth took a loan of $4900 at the rate of 7% simple interest per annum. If he paid an amount of $6958 to clear the loan, then find the time period of the loan.
(7) John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $5984 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 5% simple interest.
(9) Find the amount to be paid if Susan borrowed a sum of $5650 at 9% simple interest for 8 years.
(10) What amount will be due after 2 years if Robert borrowed a sum of $3050 at a 5% simple interest?