Question:
What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 6% simple interest?
Correct Answer
$4488
Solution And Explanation
Solution
Given,
Principal (P) = $3300
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) = $3300 × 6% × 6
= $3300 ×6/100 × 6
= 3300 × 6 × 6/100
= 19800 × 6/100
= 118800/100
= $1188
Thus, Simple Interest = $1188
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 = $3300 + $1188
= $4488
Thus, Amount to be paid = $4488 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 = $3300
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 6 years
Thus, Amount (A)
= $3300 + ($3300 × 6% × 6)
= $3300 + ($3300 ×6/100 × 6)
= $3300 + (3300 × 6 × 6/100)
= $3300 + (19800 × 6/100)
= $3300 + (118800/100)
= $3300 + $1188 = $4488
Thus, Amount (A) to be paid = $4488 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 $3300, the simple interest in 1 year
= 6/100 × 3300
= 6 × 3300/100
= 19800/100 = $198
Thus, simple interest for 1 year = $198
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $198 × 6 = $1188
Thus, Simple Interest (SI) = $1188
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $1188
= $4488
Thus, Amount to be paid = $4488 Answer
Similar Questions
(1) Linda took a loan of $4700 at the rate of 10% simple interest per annum. If he paid an amount of $9400 to clear the loan, then find the time period of the loan.
(2) In how much time a principal of $3200 will amount to $3392 at a simple interest of 2% per annum?
(3) How much loan did Daniel borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7625 to clear it?
(4) Find the amount to be paid if Mary borrowed a sum of $5050 at 3% simple interest for 7 years.
(5) What amount does William have to pay after 6 years if he takes a loan of $3500 at 7% simple interest?
(6) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 3% simple interest for 4 years.
(7) Sarah took a loan of $5700 at the rate of 9% simple interest per annum. If he paid an amount of $8778 to clear the loan, then find the time period of the loan.
(8) John took a loan of $4400 at the rate of 9% simple interest per annum. If he paid an amount of $8360 to clear the loan, then find the time period of the loan.
(9) John had to pay $3584 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(10) Find the amount to be paid if Robert borrowed a sum of $5100 at 3% simple interest for 8 years.