Question:
What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 3% simple interest?
Correct Answer
$3565
Solution And Explanation
Solution
Given,
Principal (P) = $3100
Rate of Simple Interest (SI) = 3%
Time (t) = 5 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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 × 3% × 5
= $3100 ×3/100 × 5
= 3100 × 3 × 5/100
= 9300 × 5/100
= 46500/100
= $465
Thus, Simple Interest = $465
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 + $465
= $3565
Thus, Amount to be paid = $3565 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) = 3%
And, Time (t) = 5 years
Thus, Amount (A)
= $3100 + ($3100 × 3% × 5)
= $3100 + ($3100 ×3/100 × 5)
= $3100 + (3100 × 3 × 5/100)
= $3100 + (9300 × 5/100)
= $3100 + (46500/100)
= $3100 + $465 = $3565
Thus, Amount (A) to be paid = $3565 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $3100, the simple interest in 1 year
= 3/100 × 3100
= 3 × 3100/100
= 9300/100 = $93
Thus, simple interest for 1 year = $93
Therefore, simple interest for 5 years
= Simple interest for 1 year × 5
= $93 × 5 = $465
Thus, Simple Interest (SI) = $465
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3100 + $465
= $3565
Thus, Amount to be paid = $3565 Answer
Similar Questions
(1) Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $7650 to clear the loan, then find the time period of the loan.
(2) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 7% simple interest?
(3) Calculate the amount due if Karen borrowed a sum of $3950 at 8% simple interest for 4 years.
(4) Donald had to pay $5040 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(5) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 8% simple interest?
(6) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $7987 to clear the loan, then find the time period of the loan.
(7) If David borrowed $3400 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(8) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 7% simple interest?
(9) If Robert paid $3720 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(10) If Susan borrowed $3650 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.