Question:
Calculate the amount due if Charles borrowed a sum of $3900 at 6% simple interest for 4 years.
Correct Answer
$4836
Solution And Explanation
Solution
Given,
Principal (P) = $3900
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) = $3900 × 6% × 4
= $3900 ×6/100 × 4
= 3900 × 6 × 4/100
= 23400 × 4/100
= 93600/100
= $936
Thus, Simple Interest = $936
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 = $3900 + $936
= $4836
Thus, Amount to be paid = $4836 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 = $3900
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 4 years
Thus, Amount (A)
= $3900 + ($3900 × 6% × 4)
= $3900 + ($3900 ×6/100 × 4)
= $3900 + (3900 × 6 × 4/100)
= $3900 + (23400 × 4/100)
= $3900 + (93600/100)
= $3900 + $936 = $4836
Thus, Amount (A) to be paid = $4836 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 $3900, the simple interest in 1 year
= 6/100 × 3900
= 6 × 3900/100
= 23400/100 = $234
Thus, simple interest for 1 year = $234
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $234 × 4 = $936
Thus, Simple Interest (SI) = $936
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3900 + $936
= $4836
Thus, Amount to be paid = $4836 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 4% simple interest.
(2) Lisa took a loan of $6100 at the rate of 8% simple interest per annum. If he paid an amount of $9028 to clear the loan, then find the time period of the loan.
(3) How much loan did Susan borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6780 to clear it?
(4) Find the amount to be paid if Charles borrowed a sum of $5900 at 5% simple interest for 7 years.
(5) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 6% simple interest?
(6) Lisa took a loan of $6100 at the rate of 7% simple interest per annum. If he paid an amount of $9089 to clear the loan, then find the time period of the loan.
(7) How much loan did Jennifer borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6562.5 to clear it?
(8) Christopher had to pay $4600 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(9) Find the amount to be paid if Barbara borrowed a sum of $5550 at 9% simple interest for 8 years.
(10) Find the amount to be paid if Sarah borrowed a sum of $5850 at 9% simple interest for 8 years.