Question:
What amount does John have to pay after 6 years if he takes a loan of $3200 at 9% simple interest?
Correct Answer
$4928
Solution And Explanation
Solution
Given,
Principal (P) = $3200
Rate of Simple Interest (SI) = 9%
Time (t) = 6 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $3200 × 9% × 6
= $3200 ×9/100 × 6
= 3200 × 9 × 6/100
= 28800 × 6/100
= 172800/100
= $1728
Thus, Simple Interest = $1728
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 = $3200 + $1728
= $4928
Thus, Amount to be paid = $4928 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 = $3200
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 6 years
Thus, Amount (A)
= $3200 + ($3200 × 9% × 6)
= $3200 + ($3200 ×9/100 × 6)
= $3200 + (3200 × 9 × 6/100)
= $3200 + (28800 × 6/100)
= $3200 + (172800/100)
= $3200 + $1728 = $4928
Thus, Amount (A) to be paid = $4928 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $3200, the simple interest in 1 year
= 9/100 × 3200
= 9 × 3200/100
= 28800/100 = $288
Thus, simple interest for 1 year = $288
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $288 × 6 = $1728
Thus, Simple Interest (SI) = $1728
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3200 + $1728
= $4928
Thus, Amount to be paid = $4928 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 3% simple interest.
(2) If Jennifer paid $3640 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(3) Paul had to pay $5123 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(4) Find the amount to be paid if Jessica borrowed a sum of $5750 at 5% simple interest for 8 years.
(5) What amount will be due after 2 years if Charles borrowed a sum of $3450 at a 9% simple interest?
(6) Find the amount to be paid if Patricia borrowed a sum of $5150 at 9% simple interest for 7 years.
(7) What amount does William have to pay after 5 years if he takes a loan of $3500 at 8% simple interest?
(8) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 3% simple interest for 7 years.
(9) If Richard paid $4176 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(10) Patricia had to pay $3339 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.