Question:
What amount does James have to pay after 6 years if he takes a loan of $3000 at 3% simple interest?
Correct Answer
$3540
Solution And Explanation
Solution
Given,
Principal (P) = $3000
Rate of Simple Interest (SI) = 3%
Time (t) = 6 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) = $3000 × 3% × 6
= $3000 ×3/100 × 6
= 3000 × 3 × 6/100
= 9000 × 6/100
= 54000/100
= $540
Thus, Simple Interest = $540
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 = $3000 + $540
= $3540
Thus, Amount to be paid = $3540 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 = $3000
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 6 years
Thus, Amount (A)
= $3000 + ($3000 × 3% × 6)
= $3000 + ($3000 ×3/100 × 6)
= $3000 + (3000 × 3 × 6/100)
= $3000 + (9000 × 6/100)
= $3000 + (54000/100)
= $3000 + $540 = $3540
Thus, Amount (A) to be paid = $3540 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 $3000, the simple interest in 1 year
= 3/100 × 3000
= 3 × 3000/100
= 9000/100 = $90
Thus, simple interest for 1 year = $90
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $90 × 6 = $540
Thus, Simple Interest (SI) = $540
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3000 + $540
= $3540
Thus, Amount to be paid = $3540 Answer
Similar Questions
(1) How much loan did Jacob borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9600 to clear it?
(2) How much loan did Matthew borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7130 to clear it?
(3) Donald took a loan of $7000 at the rate of 6% simple interest per annum. If he paid an amount of $10780 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if Mary borrowed a sum of $5050 at 7% simple interest for 8 years.
(5) Find the amount to be paid if Patricia borrowed a sum of $5150 at 5% simple interest for 7 years.
(6) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $12540 to clear the loan, then find the time period of the loan.
(7) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 6% simple interest.
(8) Donna had to pay $5577.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(9) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $5920 to clear the loan, then find the time period of the loan.
(10) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $10132 to clear the loan, then find the time period of the loan.