Question:
Calculate the amount due if John borrowed a sum of $3200 at 9% simple interest for 4 years.
Correct Answer
$4352
Solution And Explanation
Solution
Given,
Principal (P) = $3200
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) = $3200 × 9% × 4
= $3200 ×9/100 × 4
= 3200 × 9 × 4/100
= 28800 × 4/100
= 115200/100
= $1152
Thus, Simple Interest = $1152
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 + $1152
= $4352
Thus, Amount to be paid = $4352 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) = 9%
And, Time (t) = 4 years
Thus, Amount (A)
= $3200 + ($3200 × 9% × 4)
= $3200 + ($3200 ×9/100 × 4)
= $3200 + (3200 × 9 × 4/100)
= $3200 + (28800 × 4/100)
= $3200 + (115200/100)
= $3200 + $1152 = $4352
Thus, Amount (A) to be paid = $4352 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 $3200, the simple interest in 1 year
= 9/100 × 3200
= 9 × 3200/100
= 28800/100 = $288
Thus, simple interest for 1 year = $288
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $288 × 4 = $1152
Thus, Simple Interest (SI) = $1152
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3200 + $1152
= $4352
Thus, Amount to be paid = $4352 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.
(2) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 2% simple interest?
(3) Calculate the amount due if Richard borrowed a sum of $3600 at 8% simple interest for 3 years.
(4) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 9% simple interest?
(5) Calculate the amount due after 9 years if Charles borrowed a sum of $5900 at a rate of 10% simple interest.
(6) Calculate the amount due if Joseph borrowed a sum of $3700 at 8% simple interest for 3 years.
(7) Calculate the amount due if Michael borrowed a sum of $3300 at 9% simple interest for 3 years.
(8) Mary took a loan of $4100 at the rate of 9% simple interest per annum. If he paid an amount of $7052 to clear the loan, then find the time period of the loan.
(9) David took a loan of $4800 at the rate of 7% simple interest per annum. If he paid an amount of $7824 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if Richard borrowed a sum of $3600 at 2% simple interest for 4 years.