Question:
What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 2% simple interest?
Correct Answer
$3416
Solution And Explanation
Solution
Given,
Principal (P) = $3050
Rate of Simple Interest (SI) = 2%
Time (t) = 6 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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) = $3050 × 2% × 6
= $3050 ×2/100 × 6
= 3050 × 2 × 6/100
= 6100 × 6/100
= 36600/100
= $366
Thus, Simple Interest = $366
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 = $3050 + $366
= $3416
Thus, Amount to be paid = $3416 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 = $3050
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 6 years
Thus, Amount (A)
= $3050 + ($3050 × 2% × 6)
= $3050 + ($3050 ×2/100 × 6)
= $3050 + (3050 × 2 × 6/100)
= $3050 + (6100 × 6/100)
= $3050 + (36600/100)
= $3050 + $366 = $3416
Thus, Amount (A) to be paid = $3416 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 2%
This, means, $2 per $100 per year
∵ For $100, the simple interest for 1 year = $2
∴ For $1, the simple interest for 1 year = 2/100
∴ For $3050, the simple interest in 1 year
= 2/100 × 3050
= 2 × 3050/100
= 6100/100 = $61
Thus, simple interest for 1 year = $61
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $61 × 6 = $366
Thus, Simple Interest (SI) = $366
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3050 + $366
= $3416
Thus, Amount to be paid = $3416 Answer
Similar Questions
(1) Calculate the amount due if Robert borrowed a sum of $3100 at 6% simple interest for 3 years.
(2) If Ashley paid $5460 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(3) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 6% simple interest?
(4) Find the amount to be paid if Thomas borrowed a sum of $5800 at 5% simple interest for 7 years.
(5) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $7040 to clear the loan, then find the time period of the loan.
(6) In how much time a principal of $3200 will amount to $3584 at a simple interest of 4% per annum?
(7) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 4% simple interest?
(8) If John borrowed $3200 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(9) Calculate the amount due after 9 years if Joseph borrowed a sum of $5700 at a rate of 4% simple interest.
(10) How much loan did David borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6210 to clear it?