Question:
What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 9% simple interest?
Correct Answer
$5082
Solution And Explanation
Solution
Given,
Principal (P) = $3300
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) = $3300 × 9% × 6
= $3300 ×9/100 × 6
= 3300 × 9 × 6/100
= 29700 × 6/100
= 178200/100
= $1782
Thus, Simple Interest = $1782
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 = $3300 + $1782
= $5082
Thus, Amount to be paid = $5082 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 = $3300
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 6 years
Thus, Amount (A)
= $3300 + ($3300 × 9% × 6)
= $3300 + ($3300 ×9/100 × 6)
= $3300 + (3300 × 9 × 6/100)
= $3300 + (29700 × 6/100)
= $3300 + (178200/100)
= $3300 + $1782 = $5082
Thus, Amount (A) to be paid = $5082 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 $3300, the simple interest in 1 year
= 9/100 × 3300
= 9 × 3300/100
= 29700/100 = $297
Thus, simple interest for 1 year = $297
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $297 × 6 = $1782
Thus, Simple Interest (SI) = $1782
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $1782
= $5082
Thus, Amount to be paid = $5082 Answer
Similar Questions
(1) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 10% simple interest?
(2) If John borrowed $3200 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(3) Barbara took a loan of $5100 at the rate of 9% simple interest per annum. If he paid an amount of $7854 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if Patricia borrowed a sum of $5150 at 3% simple interest for 8 years.
(5) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $11084 to clear the loan, then find the time period of the loan.
(6) If Mary paid $3660 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(7) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 5% simple interest.
(8) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 10% simple interest?
(9) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 4% simple interest.
(10) Find the amount to be paid if William borrowed a sum of $5500 at 9% simple interest for 7 years.