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) William took a loan of $5000 at the rate of 8% simple interest per annum. If he paid an amount of $8600 to clear the loan, then find the time period of the loan.
(2) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 7% simple interest?
(3) What amount does David have to pay after 6 years if he takes a loan of $3400 at 9% simple interest?
(4) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 5% simple interest?
(5) Calculate the amount due if Joseph borrowed a sum of $3700 at 10% simple interest for 4 years.
(6) How much loan did Charles borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6785 to clear it?
(7) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 6% simple interest for 7 years.
(8) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $7987 to clear the loan, then find the time period of the loan.
(9) Karen took a loan of $5900 at the rate of 10% simple interest per annum. If he paid an amount of $11210 to clear the loan, then find the time period of the loan.
(10) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 5% simple interest?