Question:
What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 6% simple interest?
Correct Answer
$4556
Solution And Explanation
Solution
Given,
Principal (P) = $3350
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) = $3350 × 6% × 6
= $3350 ×6/100 × 6
= 3350 × 6 × 6/100
= 20100 × 6/100
= 120600/100
= $1206
Thus, Simple Interest = $1206
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 = $3350 + $1206
= $4556
Thus, Amount to be paid = $4556 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 = $3350
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 6 years
Thus, Amount (A)
= $3350 + ($3350 × 6% × 6)
= $3350 + ($3350 ×6/100 × 6)
= $3350 + (3350 × 6 × 6/100)
= $3350 + (20100 × 6/100)
= $3350 + (120600/100)
= $3350 + $1206 = $4556
Thus, Amount (A) to be paid = $4556 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 $3350, the simple interest in 1 year
= 6/100 × 3350
= 6 × 3350/100
= 20100/100 = $201
Thus, simple interest for 1 year = $201
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $201 × 6 = $1206
Thus, Simple Interest (SI) = $1206
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3350 + $1206
= $4556
Thus, Amount to be paid = $4556 Answer
Similar Questions
(1) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $8624 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due if James borrowed a sum of $3000 at 8% simple interest for 3 years.
(3) Find the amount to be paid if Susan borrowed a sum of $5650 at 5% simple interest for 7 years.
(4) In how much time a principal of $3050 will amount to $3233 at a simple interest of 2% per annum?
(5) Find the amount to be paid if James borrowed a sum of $5000 at 9% simple interest for 7 years.
(6) Find the amount to be paid if Jessica borrowed a sum of $5750 at 10% simple interest for 7 years.
(7) Donald took a loan of $7000 at the rate of 6% simple interest per annum. If he paid an amount of $10780 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 9% simple interest.
(9) Calculate the amount due if Michael borrowed a sum of $3300 at 7% simple interest for 3 years.
(10) How much loan did Elizabeth borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5995 to clear it?