Question:
What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 4% simple interest?
Correct Answer
$4526
Solution And Explanation
Solution
Given,
Principal (P) = $3650
Rate of Simple Interest (SI) = 4%
Time (t) = 6 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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 × 4% × 6
= $3650 ×4/100 × 6
= 3650 × 4 × 6/100
= 14600 × 6/100
= 87600/100
= $876
Thus, Simple Interest = $876
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 + $876
= $4526
Thus, Amount to be paid = $4526 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) = 4%
And, Time (t) = 6 years
Thus, Amount (A)
= $3650 + ($3650 × 4% × 6)
= $3650 + ($3650 ×4/100 × 6)
= $3650 + (3650 × 4 × 6/100)
= $3650 + (14600 × 6/100)
= $3650 + (87600/100)
= $3650 + $876 = $4526
Thus, Amount (A) to be paid = $4526 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 4%
This, means, $4 per $100 per year
∵ For $100, the simple interest for 1 year = $4
∴ For $1, the simple interest for 1 year = 4/100
∴ For $3650, the simple interest in 1 year
= 4/100 × 3650
= 4 × 3650/100
= 14600/100 = $146
Thus, simple interest for 1 year = $146
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $146 × 6 = $876
Thus, Simple Interest (SI) = $876
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $876
= $4526
Thus, Amount to be paid = $4526 Answer
Similar Questions
(1) What amount does Patricia have to pay after 5 years if he takes a loan of $3150 at 10% simple interest?
(2) Sarah took a loan of $5700 at the rate of 9% simple interest per annum. If he paid an amount of $9291 to clear the loan, then find the time period of the loan.
(3) Jessica had to pay $3975 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(4) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 7% simple interest.
(5) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 3% simple interest.
(6) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $9900 to clear the loan, then find the time period of the loan.
(7) Calculate the amount due if James borrowed a sum of $3000 at 6% simple interest for 4 years.
(8) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 9% simple interest.
(9) Sandra took a loan of $6900 at the rate of 9% simple interest per annum. If he paid an amount of $11247 to clear the loan, then find the time period of the loan.
(10) In how much time a principal of $3000 will amount to $3450 at a simple interest of 3% per annum?