Question:
What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 9% simple interest?
Correct Answer
$5775
Solution And Explanation
Solution
Given,
Principal (P) = $3750
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) = $3750 × 9% × 6
= $3750 ×9/100 × 6
= 3750 × 9 × 6/100
= 33750 × 6/100
= 202500/100
= $2025
Thus, Simple Interest = $2025
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 = $3750 + $2025
= $5775
Thus, Amount to be paid = $5775 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 = $3750
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 6 years
Thus, Amount (A)
= $3750 + ($3750 × 9% × 6)
= $3750 + ($3750 ×9/100 × 6)
= $3750 + (3750 × 9 × 6/100)
= $3750 + (33750 × 6/100)
= $3750 + (202500/100)
= $3750 + $2025 = $5775
Thus, Amount (A) to be paid = $5775 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 $3750, the simple interest in 1 year
= 9/100 × 3750
= 9 × 3750/100
= 33750/100 = $337.5
Thus, simple interest for 1 year = $337.5
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $337.5 × 6 = $2025
Thus, Simple Interest (SI) = $2025
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3750 + $2025
= $5775
Thus, Amount to be paid = $5775 Answer
Similar Questions
(1) Karen took a loan of $5900 at the rate of 7% simple interest per annum. If he paid an amount of $10030 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due if Sarah borrowed a sum of $3850 at 10% simple interest for 3 years.
(3) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 5% simple interest?
(4) What amount will be due after 2 years if William borrowed a sum of $3250 at a 7% simple interest?
(5) In how much time a principal of $3200 will amount to $3328 at a simple interest of 2% per annum?
(6) Matthew took a loan of $6400 at the rate of 7% simple interest per annum. If he paid an amount of $10432 to clear the loan, then find the time period of the loan.
(7) What amount will be due after 2 years if Charles borrowed a sum of $3450 at a 4% simple interest?
(8) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $11222 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 6% simple interest.
(10) Robert took a loan of $4200 at the rate of 8% simple interest per annum. If he paid an amount of $7224 to clear the loan, then find the time period of the loan.