Question:
What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 6% simple interest?
Correct Answer
$4420
Solution And Explanation
Solution
Given,
Principal (P) = $3250
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) = $3250 × 6% × 6
= $3250 ×6/100 × 6
= 3250 × 6 × 6/100
= 19500 × 6/100
= 117000/100
= $1170
Thus, Simple Interest = $1170
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 = $3250 + $1170
= $4420
Thus, Amount to be paid = $4420 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 = $3250
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 6 years
Thus, Amount (A)
= $3250 + ($3250 × 6% × 6)
= $3250 + ($3250 ×6/100 × 6)
= $3250 + (3250 × 6 × 6/100)
= $3250 + (19500 × 6/100)
= $3250 + (117000/100)
= $3250 + $1170 = $4420
Thus, Amount (A) to be paid = $4420 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 $3250, the simple interest in 1 year
= 6/100 × 3250
= 6 × 3250/100
= 19500/100 = $195
Thus, simple interest for 1 year = $195
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $195 × 6 = $1170
Thus, Simple Interest (SI) = $1170
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3250 + $1170
= $4420
Thus, Amount to be paid = $4420 Answer
Similar Questions
(1) Find the amount to be paid if Susan borrowed a sum of $5650 at 3% simple interest for 7 years.
(2) Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 8% simple interest.
(3) If Jessica paid $4050 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(4) Richard took a loan of $5200 at the rate of 9% simple interest per annum. If he paid an amount of $8476 to clear the loan, then find the time period of the loan.
(5) Michelle had to pay $5247 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(6) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $7548 to clear the loan, then find the time period of the loan.
(7) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 8% simple interest.
(8) Jennifer had to pay $3542.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(9) Calculate the amount due if Richard borrowed a sum of $3600 at 6% simple interest for 4 years.
(10) Calculate the amount due if Patricia borrowed a sum of $3150 at 3% simple interest for 3 years.