Question:
What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 6% simple interest?
Correct Answer
$5100
Solution And Explanation
Solution
Given,
Principal (P) = $3750
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) = $3750 × 6% × 6
= $3750 ×6/100 × 6
= 3750 × 6 × 6/100
= 22500 × 6/100
= 135000/100
= $1350
Thus, Simple Interest = $1350
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 = $3750 + $1350
= $5100
Thus, Amount to be paid = $5100 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 = $3750
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 6 years
Thus, Amount (A)
= $3750 + ($3750 × 6% × 6)
= $3750 + ($3750 ×6/100 × 6)
= $3750 + (3750 × 6 × 6/100)
= $3750 + (22500 × 6/100)
= $3750 + (135000/100)
= $3750 + $1350 = $5100
Thus, Amount (A) to be paid = $5100 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 $3750, the simple interest in 1 year
= 6/100 × 3750
= 6 × 3750/100
= 22500/100 = $225
Thus, simple interest for 1 year = $225
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $225 × 6 = $1350
Thus, Simple Interest (SI) = $1350
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3750 + $1350
= $5100
Thus, Amount to be paid = $5100 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 6% simple interest.
(2) Sandra took a loan of $6900 at the rate of 9% simple interest per annum. If he paid an amount of $10626 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Robert borrowed a sum of $5100 at 8% simple interest for 7 years.
(4) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 10% simple interest?
(5) Calculate the amount due if Robert borrowed a sum of $3100 at 4% simple interest for 3 years.
(6) How much loan did Jeffrey borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9750 to clear it?
(7) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $7480 to clear the loan, then find the time period of the loan.
(8) How much loan did Daniel borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6710 to clear it?
(9) Jessica took a loan of $5500 at the rate of 10% simple interest per annum. If he paid an amount of $8800 to clear the loan, then find the time period of the loan.
(10) Find the amount to be paid if Susan borrowed a sum of $5650 at 7% simple interest for 8 years.