Question:
( 1 of 10 ) What amount does Charles have to pay after 5 years if he takes a loan of $3900 at 6% simple interest?
(A) 59
(B) 30.5
(C) 61
(D) 60
You selected
$3900
Correct Answer
$5070
Solution And Explanation
Solution
Given,
Principal (P) = $3900
Rate of Simple Interest (SI) = 6%
Time (t) = 5 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $3900 × 6% × 5
= $3900 ×6/100 × 5
= 3900 × 6 × 5/100
= 23400 × 5/100
= 117000/100
= $1170
Thus, Simple Interest = $1170
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 = $3900 + $1170
= $5070
Thus, Amount to be paid = $5070 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 = $3900
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 5 years
Thus, Amount (A)
= $3900 + ($3900 × 6% × 5)
= $3900 + ($3900 ×6/100 × 5)
= $3900 + (3900 × 6 × 5/100)
= $3900 + (23400 × 5/100)
= $3900 + (117000/100)
= $3900 + $1170 = $5070
Thus, Amount (A) to be paid = $5070 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $3900, the simple interest in 1 year
= 6/100 × 3900
= 6 × 3900/100
= 23400/100 = $234
Thus, simple interest for 1 year = $234
Therefore, simple interest for 5 years
= Simple interest for 1 year × 5
= $234 × 5 = $1170
Thus, Simple Interest (SI) = $1170
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3900 + $1170
= $5070
Thus, Amount to be paid = $5070 Answer
Similar Questions
(1) In how much time a principal of $3050 will amount to $3812.5 at a simple interest of 5% per annum?
(2) Find the amount to be paid if Patricia borrowed a sum of $5150 at 3% simple interest for 8 years.
(3) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 3% simple interest?
(4) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 6% simple interest.
(5) How much loan did Sarah borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6435 to clear it?
(6) Mary had to pay $3233 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(7) If Paul paid $5640 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(8) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 5% simple interest.
(9) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 10% simple interest?
(10) Calculate the amount due if Richard borrowed a sum of $3600 at 5% simple interest for 3 years.