Question:
What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 3% simple interest?
Correct Answer
$4307
Solution And Explanation
Solution
Given,
Principal (P) = $3650
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) = $3650 × 3% × 6
= $3650 ×3/100 × 6
= 3650 × 3 × 6/100
= 10950 × 6/100
= 65700/100
= $657
Thus, Simple Interest = $657
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 = $3650 + $657
= $4307
Thus, Amount to be paid = $4307 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 = $3650
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 6 years
Thus, Amount (A)
= $3650 + ($3650 × 3% × 6)
= $3650 + ($3650 ×3/100 × 6)
= $3650 + (3650 × 3 × 6/100)
= $3650 + (10950 × 6/100)
= $3650 + (65700/100)
= $3650 + $657 = $4307
Thus, Amount (A) to be paid = $4307 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 $3650, the simple interest in 1 year
= 3/100 × 3650
= 3 × 3650/100
= 10950/100 = $109.5
Thus, simple interest for 1 year = $109.5
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $109.5 × 6 = $657
Thus, Simple Interest (SI) = $657
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $657
= $4307
Thus, Amount to be paid = $4307 Answer
Similar Questions
(1) What amount does John have to pay after 6 years if he takes a loan of $3200 at 7% simple interest?
(2) How much loan did David borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6480 to clear it?
(3) William took a loan of $5000 at the rate of 6% simple interest per annum. If he paid an amount of $7700 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if David borrowed a sum of $5400 at 3% simple interest for 8 years.
(5) Find the amount to be paid if Robert borrowed a sum of $5100 at 4% simple interest for 8 years.
(6) Andrew had to pay $5232 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(7) Find the amount to be paid if Sarah borrowed a sum of $5850 at 2% simple interest for 7 years.
(8) Sandra took a loan of $6900 at the rate of 6% simple interest per annum. If he paid an amount of $11040 to clear the loan, then find the time period of the loan.
(9) Lisa took a loan of $6100 at the rate of 9% simple interest per annum. If he paid an amount of $9943 to clear the loan, then find the time period of the loan.
(10) Thomas took a loan of $5600 at the rate of 7% simple interest per annum. If he paid an amount of $9520 to clear the loan, then find the time period of the loan.