Question:
What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 3% simple interest?
Correct Answer
$3953
Solution And Explanation
Solution
Given,
Principal (P) = $3350
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) = $3350 × 3% × 6
= $3350 ×3/100 × 6
= 3350 × 3 × 6/100
= 10050 × 6/100
= 60300/100
= $603
Thus, Simple Interest = $603
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 = $3350 + $603
= $3953
Thus, Amount to be paid = $3953 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 = $3350
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 6 years
Thus, Amount (A)
= $3350 + ($3350 × 3% × 6)
= $3350 + ($3350 ×3/100 × 6)
= $3350 + (3350 × 3 × 6/100)
= $3350 + (10050 × 6/100)
= $3350 + (60300/100)
= $3350 + $603 = $3953
Thus, Amount (A) to be paid = $3953 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 $3350, the simple interest in 1 year
= 3/100 × 3350
= 3 × 3350/100
= 10050/100 = $100.5
Thus, simple interest for 1 year = $100.5
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $100.5 × 6 = $603
Thus, Simple Interest (SI) = $603
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3350 + $603
= $3953
Thus, Amount to be paid = $3953 Answer
Similar Questions
(1) Find the amount to be paid if Robert borrowed a sum of $5100 at 10% simple interest for 8 years.
(2) Elizabeth took a loan of $4900 at the rate of 8% simple interest per annum. If he paid an amount of $8036 to clear the loan, then find the time period of the loan.
(3) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 5% simple interest.
(4) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $9180 to clear the loan, then find the time period of the loan.
(5) If Jennifer borrowed $3250 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(6) How much loan did Richard borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6720 to clear it?
(7) Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $7810 to clear the loan, then find the time period of the loan.
(8) Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $10140 to clear the loan, then find the time period of the loan.
(9) Patricia took a loan of $4300 at the rate of 10% simple interest per annum. If he paid an amount of $7310 to clear the loan, then find the time period of the loan.
(10) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 8% simple interest?