Question:
What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 9% simple interest?
Correct Answer
$5005
Solution And Explanation
Solution
Given,
Principal (P) = $3250
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) = $3250 × 9% × 6
= $3250 ×9/100 × 6
= 3250 × 9 × 6/100
= 29250 × 6/100
= 175500/100
= $1755
Thus, Simple Interest = $1755
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 = $3250 + $1755
= $5005
Thus, Amount to be paid = $5005 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 = $3250
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 6 years
Thus, Amount (A)
= $3250 + ($3250 × 9% × 6)
= $3250 + ($3250 ×9/100 × 6)
= $3250 + (3250 × 9 × 6/100)
= $3250 + (29250 × 6/100)
= $3250 + (175500/100)
= $3250 + $1755 = $5005
Thus, Amount (A) to be paid = $5005 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 $3250, the simple interest in 1 year
= 9/100 × 3250
= 9 × 3250/100
= 29250/100 = $292.5
Thus, simple interest for 1 year = $292.5
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $292.5 × 6 = $1755
Thus, Simple Interest (SI) = $1755
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3250 + $1755
= $5005
Thus, Amount to be paid = $5005 Answer
Similar Questions
(1) Find the amount to be paid if John borrowed a sum of $5200 at 9% simple interest for 7 years.
(2) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $10608 to clear the loan, then find the time period of the loan.
(3) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 7% simple interest?
(4) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 7% simple interest.
(5) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $9514 to clear the loan, then find the time period of the loan.
(6) Karen took a loan of $5900 at the rate of 10% simple interest per annum. If he paid an amount of $9440 to clear the loan, then find the time period of the loan.
(7) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 8% simple interest.
(8) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 4% simple interest?
(9) Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $8568 to clear the loan, then find the time period of the loan.
(10) Joseph took a loan of $5400 at the rate of 6% simple interest per annum. If he paid an amount of $7344 to clear the loan, then find the time period of the loan.