Question:
What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 10% simple interest?
Correct Answer
$4880
Solution And Explanation
Solution
Given,
Principal (P) = $3050
Rate of Simple Interest (SI) = 10%
Time (t) = 6 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $3050 × 10% × 6
= $3050 ×10/100 × 6
= 3050 × 10 × 6/100
= 30500 × 6/100
= 183000/100
= $1830
Thus, Simple Interest = $1830
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 = $3050 + $1830
= $4880
Thus, Amount to be paid = $4880 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 = $3050
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 6 years
Thus, Amount (A)
= $3050 + ($3050 × 10% × 6)
= $3050 + ($3050 ×10/100 × 6)
= $3050 + (3050 × 10 × 6/100)
= $3050 + (30500 × 6/100)
= $3050 + (183000/100)
= $3050 + $1830 = $4880
Thus, Amount (A) to be paid = $4880 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 10%
This, means, $10 per $100 per year
∵ For $100, the simple interest for 1 year = $10
∴ For $1, the simple interest for 1 year = 10/100
∴ For $3050, the simple interest in 1 year
= 10/100 × 3050
= 10 × 3050/100
= 30500/100 = $305
Thus, simple interest for 1 year = $305
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $305 × 6 = $1830
Thus, Simple Interest (SI) = $1830
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3050 + $1830
= $4880
Thus, Amount to be paid = $4880 Answer
Similar Questions
(1) Thomas took a loan of $5600 at the rate of 8% simple interest per annum. If he paid an amount of $9632 to clear the loan, then find the time period of the loan.
(2) Find the amount to be paid if James borrowed a sum of $5000 at 6% simple interest for 7 years.
(3) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 9% simple interest?
(4) If Charles paid $4524 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(5) Susan took a loan of $5300 at the rate of 6% simple interest per annum. If he paid an amount of $8162 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if John borrowed a sum of $5200 at 2% simple interest for 7 years.
(7) If Lisa paid $4374 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(8) Calculate the amount due if Thomas borrowed a sum of $3800 at 2% simple interest for 3 years.
(9) Donald took a loan of $7000 at the rate of 9% simple interest per annum. If he paid an amount of $10780 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if John borrowed a sum of $3200 at 8% simple interest for 3 years.