Question:
Calculate the amount due if Michael borrowed a sum of $3300 at 10% simple interest for 4 years.
Correct Answer
$4620
Solution And Explanation
Solution
Given,
Principal (P) = $3300
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) = $3300 × 10% × 4
= $3300 ×10/100 × 4
= 3300 × 10 × 4/100
= 33000 × 4/100
= 132000/100
= $1320
Thus, Simple Interest = $1320
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 + $1320
= $4620
Thus, Amount to be paid = $4620 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) = 10%
And, Time (t) = 4 years
Thus, Amount (A)
= $3300 + ($3300 × 10% × 4)
= $3300 + ($3300 ×10/100 × 4)
= $3300 + (3300 × 10 × 4/100)
= $3300 + (33000 × 4/100)
= $3300 + (132000/100)
= $3300 + $1320 = $4620
Thus, Amount (A) to be paid = $4620 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 $3300, the simple interest in 1 year
= 10/100 × 3300
= 10 × 3300/100
= 33000/100 = $330
Thus, simple interest for 1 year = $330
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $330 × 4 = $1320
Thus, Simple Interest (SI) = $1320
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $1320
= $4620
Thus, Amount to be paid = $4620 Answer
Similar Questions
(1) Find the amount to be paid if Charles borrowed a sum of $5900 at 8% simple interest for 8 years.
(2) Calculate the amount due after 9 years if Robert borrowed a sum of $5100 at a rate of 7% simple interest.
(3) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 5% simple interest.
(4) In how much time a principal of $3050 will amount to $3812.5 at a simple interest of 5% per annum?
(5) Daniel took a loan of $6200 at the rate of 8% simple interest per annum. If he paid an amount of $10664 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 2% simple interest.
(7) Calculate the amount due if Karen borrowed a sum of $3950 at 4% simple interest for 4 years.
(8) Find the amount to be paid if Susan borrowed a sum of $5650 at 5% simple interest for 8 years.
(9) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 9% simple interest.
(10) 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.