Question:
Calculate the amount due if Robert borrowed a sum of $3100 at 10% simple interest for 4 years.
Correct Answer
$4340
Solution And Explanation
Solution
Given,
Principal (P) = $3100
Rate of Simple Interest (SI) = 10%
Time (t) = 4 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $3100 × 10% × 4
= $3100 ×10/100 × 4
= 3100 × 10 × 4/100
= 31000 × 4/100
= 124000/100
= $1240
Thus, Simple Interest = $1240
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 = $3100 + $1240
= $4340
Thus, Amount to be paid = $4340 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 = $3100
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 4 years
Thus, Amount (A)
= $3100 + ($3100 × 10% × 4)
= $3100 + ($3100 ×10/100 × 4)
= $3100 + (3100 × 10 × 4/100)
= $3100 + (31000 × 4/100)
= $3100 + (124000/100)
= $3100 + $1240 = $4340
Thus, Amount (A) to be paid = $4340 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 10%
This, means, $10 per $100 per year
∵ For $100, the simple interest for 1 year = $10
∴ For $1, the simple interest for 1 year = 10/100
∴ For $3100, the simple interest in 1 year
= 10/100 × 3100
= 10 × 3100/100
= 31000/100 = $310
Thus, simple interest for 1 year = $310
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $310 × 4 = $1240
Thus, Simple Interest (SI) = $1240
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3100 + $1240
= $4340
Thus, Amount to be paid = $4340 Answer
Similar Questions
(1) Calculate the amount due if Thomas borrowed a sum of $3800 at 2% simple interest for 3 years.
(2) Christopher took a loan of $6000 at the rate of 6% simple interest per annum. If he paid an amount of $8160 to clear the loan, then find the time period of the loan.
(3) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 9% simple interest?
(4) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 2% simple interest?
(5) Barbara took a loan of $5100 at the rate of 9% simple interest per annum. If he paid an amount of $7854 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due if Barbara borrowed a sum of $3550 at 5% simple interest for 4 years.
(7) In how much time a principal of $3200 will amount to $3680 at a simple interest of 5% per annum?
(8) How much loan did Sharon borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8912.5 to clear it?
(9) Christopher took a loan of $6000 at the rate of 6% simple interest per annum. If he paid an amount of $9240 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 7% simple interest.