Question:
Calculate the amount due if Michael borrowed a sum of $3300 at 9% simple interest for 4 years.
Correct Answer
$4488
Solution And Explanation
Solution
Given,
Principal (P) = $3300
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) = $3300 × 9% × 4
= $3300 ×9/100 × 4
= 3300 × 9 × 4/100
= 29700 × 4/100
= 118800/100
= $1188
Thus, Simple Interest = $1188
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 = $3300 + $1188
= $4488
Thus, Amount to be paid = $4488 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 = $3300
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 4 years
Thus, Amount (A)
= $3300 + ($3300 × 9% × 4)
= $3300 + ($3300 ×9/100 × 4)
= $3300 + (3300 × 9 × 4/100)
= $3300 + (29700 × 4/100)
= $3300 + (118800/100)
= $3300 + $1188 = $4488
Thus, Amount (A) to be paid = $4488 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 $3300, the simple interest in 1 year
= 9/100 × 3300
= 9 × 3300/100
= 29700/100 = $297
Thus, simple interest for 1 year = $297
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $297 × 4 = $1188
Thus, Simple Interest (SI) = $1188
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $1188
= $4488
Thus, Amount to be paid = $4488 Answer
Similar Questions
(1) Calculate the amount due if James borrowed a sum of $3000 at 7% simple interest for 4 years.
(2) How much loan did Timothy borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8510 to clear it?
(3) Calculate the amount due if Barbara borrowed a sum of $3550 at 3% simple interest for 3 years.
(4) If Sandra paid $4984 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(5) Calculate the amount due if William borrowed a sum of $3500 at 6% simple interest for 4 years.
(6) Calculate the amount due after 9 years if Robert borrowed a sum of $5100 at a rate of 2% simple interest.
(7) Richard took a loan of $5200 at the rate of 8% simple interest per annum. If he paid an amount of $8944 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if James borrowed a sum of $3000 at 9% simple interest for 4 years.
(9) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 3% simple interest.
(10) Calculate the amount due if Jessica borrowed a sum of $3750 at 3% simple interest for 3 years.