Question:
What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 9% simple interest?
Correct Answer
$5544
Solution And Explanation
Solution
Given,
Principal (P) = $3600
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) = $3600 × 9% × 6
= $3600 ×9/100 × 6
= 3600 × 9 × 6/100
= 32400 × 6/100
= 194400/100
= $1944
Thus, Simple Interest = $1944
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 = $3600 + $1944
= $5544
Thus, Amount to be paid = $5544 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 = $3600
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 6 years
Thus, Amount (A)
= $3600 + ($3600 × 9% × 6)
= $3600 + ($3600 ×9/100 × 6)
= $3600 + (3600 × 9 × 6/100)
= $3600 + (32400 × 6/100)
= $3600 + (194400/100)
= $3600 + $1944 = $5544
Thus, Amount (A) to be paid = $5544 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 $3600, the simple interest in 1 year
= 9/100 × 3600
= 9 × 3600/100
= 32400/100 = $324
Thus, simple interest for 1 year = $324
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $324 × 6 = $1944
Thus, Simple Interest (SI) = $1944
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3600 + $1944
= $5544
Thus, Amount to be paid = $5544 Answer
Similar Questions
(1) Calculate the amount due if Michael borrowed a sum of $3300 at 10% simple interest for 4 years.
(2) Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $9774 to clear the loan, then find the time period of the loan.
(3) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 3% simple interest.
(4) Mary took a loan of $4100 at the rate of 10% simple interest per annum. If he paid an amount of $6970 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due if Jessica borrowed a sum of $3750 at 6% simple interest for 4 years.
(6) What amount does Patricia have to pay after 5 years if he takes a loan of $3150 at 6% simple interest?
(7) Find the amount to be paid if James borrowed a sum of $5000 at 5% simple interest for 8 years.
(8) Find the amount to be paid if Susan borrowed a sum of $5650 at 7% simple interest for 8 years.
(9) 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.
(10) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $9120 to clear the loan, then find the time period of the loan.