Question:
What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 3% simple interest?
Correct Answer
$3894
Solution And Explanation
Solution
Given,
Principal (P) = $3300
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) = $3300 × 3% × 6
= $3300 ×3/100 × 6
= 3300 × 3 × 6/100
= 9900 × 6/100
= 59400/100
= $594
Thus, Simple Interest = $594
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 = $3300 + $594
= $3894
Thus, Amount to be paid = $3894 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 = $3300
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 6 years
Thus, Amount (A)
= $3300 + ($3300 × 3% × 6)
= $3300 + ($3300 ×3/100 × 6)
= $3300 + (3300 × 3 × 6/100)
= $3300 + (9900 × 6/100)
= $3300 + (59400/100)
= $3300 + $594 = $3894
Thus, Amount (A) to be paid = $3894 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 $3300, the simple interest in 1 year
= 3/100 × 3300
= 3 × 3300/100
= 9900/100 = $99
Thus, simple interest for 1 year = $99
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $99 × 6 = $594
Thus, Simple Interest (SI) = $594
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $594
= $3894
Thus, Amount to be paid = $3894 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Charles borrowed a sum of $5900 at a rate of 10% simple interest.
(2) What amount does Jessica have to pay after 5 years if he takes a loan of $3750 at 5% simple interest?
(3) Linda had to pay $3551 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(4) What amount does John have to pay after 6 years if he takes a loan of $3200 at 2% simple interest?
(5) Nancy took a loan of $6300 at the rate of 8% simple interest per annum. If he paid an amount of $10332 to clear the loan, then find the time period of the loan.
(6) What amount will be due after 2 years if Christopher borrowed a sum of $3500 at a 10% simple interest?
(7) If Joshua paid $5684 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(8) Patricia took a loan of $4300 at the rate of 6% simple interest per annum. If he paid an amount of $6622 to clear the loan, then find the time period of the loan.
(9) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 3% simple interest?
(10) Susan took a loan of $5300 at the rate of 8% simple interest per annum. If he paid an amount of $8268 to clear the loan, then find the time period of the loan.