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) Find the amount to be paid if William borrowed a sum of $5500 at 5% simple interest for 7 years.
(2) Calculate the amount due if Patricia borrowed a sum of $3150 at 5% simple interest for 3 years.
(3) What amount does Karen have to pay after 5 years if he takes a loan of $3950 at 7% simple interest?
(4) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 6% simple interest.
(5) If Donald paid $4860 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(6) What amount does William have to pay after 6 years if he takes a loan of $3500 at 4% simple interest?
(7) Jessica took a loan of $5500 at the rate of 10% simple interest per annum. If he paid an amount of $9350 to clear the loan, then find the time period of the loan.
(8) How much loan did Ryan borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9875 to clear it?
(9) Find the amount to be paid if Mary borrowed a sum of $5050 at 2% simple interest for 8 years.
(10) In how much time a principal of $3000 will amount to $3120 at a simple interest of 2% per annum?