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) Find the amount to be paid if Susan borrowed a sum of $5650 at 10% simple interest for 7 years.
(2) Karen had to pay $4542.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(3) Calculate the amount due after 9 years if Christopher borrowed a sum of $6000 at a rate of 2% simple interest.
(4) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 3% simple interest?
(5) What amount does William have to pay after 5 years if he takes a loan of $3500 at 5% simple interest?
(6) Find the amount to be paid if Mary borrowed a sum of $5050 at 9% simple interest for 7 years.
(7) Calculate the amount due if Michael borrowed a sum of $3300 at 7% simple interest for 4 years.
(8) How much loan did Steven borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7260 to clear it?
(9) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 7% simple interest.
(10) What amount does Joseph have to pay after 5 years if he takes a loan of $3700 at 9% simple interest?