Question:
What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 7% simple interest?
Correct Answer
$4331
Solution And Explanation
Solution
Given,
Principal (P) = $3050
Rate of Simple Interest (SI) = 7%
Time (t) = 6 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $3050 × 7% × 6
= $3050 ×7/100 × 6
= 3050 × 7 × 6/100
= 21350 × 6/100
= 128100/100
= $1281
Thus, Simple Interest = $1281
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 = $3050 + $1281
= $4331
Thus, Amount to be paid = $4331 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 = $3050
Rate of Simple Interest (SI) or (R) = 7%
And, Time (t) = 6 years
Thus, Amount (A)
= $3050 + ($3050 × 7% × 6)
= $3050 + ($3050 ×7/100 × 6)
= $3050 + (3050 × 7 × 6/100)
= $3050 + (21350 × 6/100)
= $3050 + (128100/100)
= $3050 + $1281 = $4331
Thus, Amount (A) to be paid = $4331 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 7%
This, means, $7 per $100 per year
∵ For $100, the simple interest for 1 year = $7
∴ For $1, the simple interest for 1 year = 7/100
∴ For $3050, the simple interest in 1 year
= 7/100 × 3050
= 7 × 3050/100
= 21350/100 = $213.5
Thus, simple interest for 1 year = $213.5
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $213.5 × 6 = $1281
Thus, Simple Interest (SI) = $1281
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3050 + $1281
= $4331
Thus, Amount to be paid = $4331 Answer
Similar Questions
(1) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 8% simple interest?
(2) Sarah took a loan of $5700 at the rate of 9% simple interest per annum. If he paid an amount of $9804 to clear the loan, then find the time period of the loan.
(3) James took a loan of $4000 at the rate of 7% simple interest per annum. If he paid an amount of $6800 to clear the loan, then find the time period of the loan.
(4) Mary took a loan of $4100 at the rate of 10% simple interest per annum. If he paid an amount of $8200 to clear the loan, then find the time period of the loan.
(5) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 8% simple interest?
(6) Calculate the amount due if Robert borrowed a sum of $3100 at 10% simple interest for 3 years.
(7) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 5% simple interest.
(8) Calculate the amount due if Thomas borrowed a sum of $3800 at 7% simple interest for 3 years.
(9) Calculate the amount due if Christopher borrowed a sum of $4000 at 4% simple interest for 3 years.
(10) Find the amount to be paid if Thomas borrowed a sum of $5800 at 6% simple interest for 8 years.