Question:
Calculate the amount due if Robert borrowed a sum of $3100 at 9% simple interest for 4 years.
Correct Answer
$4216
Solution And Explanation
Solution
Given,
Principal (P) = $3100
Rate of Simple Interest (SI) = 9%
Time (t) = 4 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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 × 9% × 4
= $3100 ×9/100 × 4
= 3100 × 9 × 4/100
= 27900 × 4/100
= 111600/100
= $1116
Thus, Simple Interest = $1116
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 + $1116
= $4216
Thus, Amount to be paid = $4216 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) = 9%
And, Time (t) = 4 years
Thus, Amount (A)
= $3100 + ($3100 × 9% × 4)
= $3100 + ($3100 ×9/100 × 4)
= $3100 + (3100 × 9 × 4/100)
= $3100 + (27900 × 4/100)
= $3100 + (111600/100)
= $3100 + $1116 = $4216
Thus, Amount (A) to be paid = $4216 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $3100, the simple interest in 1 year
= 9/100 × 3100
= 9 × 3100/100
= 27900/100 = $279
Thus, simple interest for 1 year = $279
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $279 × 4 = $1116
Thus, Simple Interest (SI) = $1116
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3100 + $1116
= $4216
Thus, Amount to be paid = $4216 Answer
Similar Questions
(1) Thomas took a loan of $5600 at the rate of 9% simple interest per annum. If he paid an amount of $8624 to clear the loan, then find the time period of the loan.
(2) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 6% simple interest?
(3) If Michelle paid $5940 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(4) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 9% simple interest?
(5) Calculate the amount due if Barbara borrowed a sum of $3550 at 4% simple interest for 3 years.
(6) If Jessica paid $4350 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(7) Barbara took a loan of $5100 at the rate of 6% simple interest per annum. If he paid an amount of $8160 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if Karen borrowed a sum of $3950 at 10% simple interest for 3 years.
(9) What amount does David have to pay after 6 years if he takes a loan of $3400 at 8% simple interest?
(10) Daniel took a loan of $6200 at the rate of 10% simple interest per annum. If he paid an amount of $9920 to clear the loan, then find the time period of the loan.