Question:
What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 8% simple interest?
Correct Answer
$5254
Solution And Explanation
Solution
Given,
Principal (P) = $3550
Rate of Simple Interest (SI) = 8%
Time (t) = 6 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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) = $3550 × 8% × 6
= $3550 ×8/100 × 6
= 3550 × 8 × 6/100
= 28400 × 6/100
= 170400/100
= $1704
Thus, Simple Interest = $1704
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 = $3550 + $1704
= $5254
Thus, Amount to be paid = $5254 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 = $3550
Rate of Simple Interest (SI) or (R) = 8%
And, Time (t) = 6 years
Thus, Amount (A)
= $3550 + ($3550 × 8% × 6)
= $3550 + ($3550 ×8/100 × 6)
= $3550 + (3550 × 8 × 6/100)
= $3550 + (28400 × 6/100)
= $3550 + (170400/100)
= $3550 + $1704 = $5254
Thus, Amount (A) to be paid = $5254 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 8%
This, means, $8 per $100 per year
∵ For $100, the simple interest for 1 year = $8
∴ For $1, the simple interest for 1 year = 8/100
∴ For $3550, the simple interest in 1 year
= 8/100 × 3550
= 8 × 3550/100
= 28400/100 = $284
Thus, simple interest for 1 year = $284
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $284 × 6 = $1704
Thus, Simple Interest (SI) = $1704
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $1704
= $5254
Thus, Amount to be paid = $5254 Answer
Similar Questions
(1) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 8% simple interest?
(2) Find the amount to be paid if Karen borrowed a sum of $5950 at 2% simple interest for 8 years.
(3) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $9020 to clear the loan, then find the time period of the loan.
(4) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 2% simple interest?
(5) Find the amount to be paid if Karen borrowed a sum of $5950 at 6% simple interest for 8 years.
(6) Susan took a loan of $5300 at the rate of 8% simple interest per annum. If he paid an amount of $7844 to clear the loan, then find the time period of the loan.
(7) How much loan did Laura borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $9027.5 to clear it?
(8) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 10% simple interest.
(9) Barbara took a loan of $5100 at the rate of 7% simple interest per annum. If he paid an amount of $7956 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 6% simple interest.