Question:
Calculate the amount due if Barbara borrowed a sum of $3550 at 9% simple interest for 4 years.
Correct Answer
$4828
Solution And Explanation
Solution
Given,
Principal (P) = $3550
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) = $3550 × 9% × 4
= $3550 ×9/100 × 4
= 3550 × 9 × 4/100
= 31950 × 4/100
= 127800/100
= $1278
Thus, Simple Interest = $1278
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 = $3550 + $1278
= $4828
Thus, Amount to be paid = $4828 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 = $3550
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 4 years
Thus, Amount (A)
= $3550 + ($3550 × 9% × 4)
= $3550 + ($3550 ×9/100 × 4)
= $3550 + (3550 × 9 × 4/100)
= $3550 + (31950 × 4/100)
= $3550 + (127800/100)
= $3550 + $1278 = $4828
Thus, Amount (A) to be paid = $4828 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 $3550, the simple interest in 1 year
= 9/100 × 3550
= 9 × 3550/100
= 31950/100 = $319.5
Thus, simple interest for 1 year = $319.5
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $319.5 × 4 = $1278
Thus, Simple Interest (SI) = $1278
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $1278
= $4828
Thus, Amount to be paid = $4828 Answer
Similar Questions
(1) Donald took a loan of $7000 at the rate of 6% simple interest per annum. If he paid an amount of $9940 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 9 years if Charles borrowed a sum of $5900 at a rate of 7% simple interest.
(3) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 5% simple interest for 7 years.
(4) If Kenneth paid $6000 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(5) If Charles paid $4212 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(6) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $7980 to clear the loan, then find the time period of the loan.
(7) William took a loan of $5000 at the rate of 10% simple interest per annum. If he paid an amount of $9000 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 7% simple interest.
(9) Linda took a loan of $4700 at the rate of 10% simple interest per annum. If he paid an amount of $8460 to clear the loan, then find the time period of the loan.
(10) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 4% simple interest?