Question:
What amount does John have to pay after 6 years if he takes a loan of $3200 at 6% simple interest?
Correct Answer
$4352
Solution And Explanation
Solution
Given,
Principal (P) = $3200
Rate of Simple Interest (SI) = 6%
Time (t) = 6 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $3200 × 6% × 6
= $3200 ×6/100 × 6
= 3200 × 6 × 6/100
= 19200 × 6/100
= 115200/100
= $1152
Thus, Simple Interest = $1152
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 = $3200 + $1152
= $4352
Thus, Amount to be paid = $4352 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 = $3200
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 6 years
Thus, Amount (A)
= $3200 + ($3200 × 6% × 6)
= $3200 + ($3200 ×6/100 × 6)
= $3200 + (3200 × 6 × 6/100)
= $3200 + (19200 × 6/100)
= $3200 + (115200/100)
= $3200 + $1152 = $4352
Thus, Amount (A) to be paid = $4352 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $3200, the simple interest in 1 year
= 6/100 × 3200
= 6 × 3200/100
= 19200/100 = $192
Thus, simple interest for 1 year = $192
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $192 × 6 = $1152
Thus, Simple Interest (SI) = $1152
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3200 + $1152
= $4352
Thus, Amount to be paid = $4352 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 7% simple interest.
(2) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $10560 to clear the loan, then find the time period of the loan.
(3) How much loan did Michael borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6625 to clear it?
(4) How much loan did Christopher borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6600 to clear it?
(5) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 3% simple interest?
(6) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 6% simple interest.
(7) If Nancy paid $4482 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(8) Find the amount to be paid if Linda borrowed a sum of $5350 at 4% simple interest for 7 years.
(9) Charles took a loan of $5800 at the rate of 8% simple interest per annum. If he paid an amount of $9976 to clear the loan, then find the time period of the loan.
(10) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 8% simple interest?