Question:
What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 2% simple interest?
Correct Answer
$3976
Solution And Explanation
Solution
Given,
Principal (P) = $3550
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) = $3550 × 2% × 6
= $3550 ×2/100 × 6
= 3550 × 2 × 6/100
= 7100 × 6/100
= 42600/100
= $426
Thus, Simple Interest = $426
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 = $3550 + $426
= $3976
Thus, Amount to be paid = $3976 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 = $3550
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 6 years
Thus, Amount (A)
= $3550 + ($3550 × 2% × 6)
= $3550 + ($3550 ×2/100 × 6)
= $3550 + (3550 × 2 × 6/100)
= $3550 + (7100 × 6/100)
= $3550 + (42600/100)
= $3550 + $426 = $3976
Thus, Amount (A) to be paid = $3976 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 $3550, the simple interest in 1 year
= 2/100 × 3550
= 2 × 3550/100
= 7100/100 = $71
Thus, simple interest for 1 year = $71
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $71 × 6 = $426
Thus, Simple Interest (SI) = $426
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $426
= $3976
Thus, Amount to be paid = $3976 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 6% simple interest.
(2) Calculate the amount due if John borrowed a sum of $3200 at 10% simple interest for 3 years.
(3) Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 4% simple interest.
(4) Calculate the amount due if Michael borrowed a sum of $3300 at 4% simple interest for 4 years.
(5) How much loan did Susan borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6497.5 to clear it?
(6) In how much time a principal of $3050 will amount to $3233 at a simple interest of 3% per annum?
(7) In how much time a principal of $3200 will amount to $3840 at a simple interest of 5% per annum?
(8) Calculate the amount due if Sarah borrowed a sum of $3850 at 3% simple interest for 3 years.
(9) Calculate the amount due if Susan borrowed a sum of $3650 at 4% simple interest for 3 years.
(10) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $10860 to clear the loan, then find the time period of the loan.