Question:
Calculate the amount due if Linda borrowed a sum of $3350 at 9% simple interest for 4 years.
Correct Answer
$4556
Solution And Explanation
Solution
Given,
Principal (P) = $3350
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) = $3350 × 9% × 4
= $3350 ×9/100 × 4
= 3350 × 9 × 4/100
= 30150 × 4/100
= 120600/100
= $1206
Thus, Simple Interest = $1206
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 = $3350 + $1206
= $4556
Thus, Amount to be paid = $4556 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 = $3350
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 4 years
Thus, Amount (A)
= $3350 + ($3350 × 9% × 4)
= $3350 + ($3350 ×9/100 × 4)
= $3350 + (3350 × 9 × 4/100)
= $3350 + (30150 × 4/100)
= $3350 + (120600/100)
= $3350 + $1206 = $4556
Thus, Amount (A) to be paid = $4556 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 $3350, the simple interest in 1 year
= 9/100 × 3350
= 9 × 3350/100
= 30150/100 = $301.5
Thus, simple interest for 1 year = $301.5
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $301.5 × 4 = $1206
Thus, Simple Interest (SI) = $1206
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3350 + $1206
= $4556
Thus, Amount to be paid = $4556 Answer
Similar Questions
(1) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 6% simple interest?
(2) What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 7% simple interest?
(3) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 3% simple interest.
(4) If Ashley paid $5460 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(5) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 2% simple interest for 8 years.
(6) Find the amount to be paid if Richard borrowed a sum of $5600 at 7% simple interest for 8 years.
(7) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 5% simple interest?
(8) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 8% simple interest.
(9) What amount does James have to pay after 6 years if he takes a loan of $3000 at 6% simple interest?
(10) What amount does Christopher have to pay after 5 years if he takes a loan of $4000 at 6% simple interest?