Question:
Calculate the amount due if Linda borrowed a sum of $3350 at 10% simple interest for 4 years.
Correct Answer
$4690
Solution And Explanation
Solution
Given,
Principal (P) = $3350
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) = $3350 × 10% × 4
= $3350 ×10/100 × 4
= 3350 × 10 × 4/100
= 33500 × 4/100
= 134000/100
= $1340
Thus, Simple Interest = $1340
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 + $1340
= $4690
Thus, Amount to be paid = $4690 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) = 10%
And, Time (t) = 4 years
Thus, Amount (A)
= $3350 + ($3350 × 10% × 4)
= $3350 + ($3350 ×10/100 × 4)
= $3350 + (3350 × 10 × 4/100)
= $3350 + (33500 × 4/100)
= $3350 + (134000/100)
= $3350 + $1340 = $4690
Thus, Amount (A) to be paid = $4690 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 $3350, the simple interest in 1 year
= 10/100 × 3350
= 10 × 3350/100
= 33500/100 = $335
Thus, simple interest for 1 year = $335
Therefore, simple interest for 4 years
= Simple interest for 1 year × 4
= $335 × 4 = $1340
Thus, Simple Interest (SI) = $1340
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3350 + $1340
= $4690
Thus, Amount to be paid = $4690 Answer
Similar Questions
(1) Mary took a loan of $4100 at the rate of 8% simple interest per annum. If he paid an amount of $7380 to clear the loan, then find the time period of the loan.
(2) Sarah took a loan of $5700 at the rate of 6% simple interest per annum. If he paid an amount of $8778 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if James borrowed a sum of $5000 at 2% simple interest for 8 years.
(4) Calculate the amount due if Sarah borrowed a sum of $3850 at 8% simple interest for 3 years.
(5) Michael took a loan of $4600 at the rate of 10% simple interest per annum. If he paid an amount of $8740 to clear the loan, then find the time period of the loan.
(6) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $7172 to clear the loan, then find the time period of the loan.
(7) Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $10080 to clear the loan, then find the time period of the loan.
(8) Find the amount to be paid if James borrowed a sum of $5000 at 6% simple interest for 7 years.
(9) Calculate the amount due if Patricia borrowed a sum of $3150 at 4% simple interest for 3 years.
(10) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 2% simple interest?