Question:
What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 10% simple interest?
Correct Answer
$5200
Solution And Explanation
Solution
Given,
Principal (P) = $3250
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) = $3250 × 10% × 6
= $3250 ×10/100 × 6
= 3250 × 10 × 6/100
= 32500 × 6/100
= 195000/100
= $1950
Thus, Simple Interest = $1950
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 + $1950
= $5200
Thus, Amount to be paid = $5200 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) = 10%
And, Time (t) = 6 years
Thus, Amount (A)
= $3250 + ($3250 × 10% × 6)
= $3250 + ($3250 ×10/100 × 6)
= $3250 + (3250 × 10 × 6/100)
= $3250 + (32500 × 6/100)
= $3250 + (195000/100)
= $3250 + $1950 = $5200
Thus, Amount (A) to be paid = $5200 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 $3250, the simple interest in 1 year
= 10/100 × 3250
= 10 × 3250/100
= 32500/100 = $325
Thus, simple interest for 1 year = $325
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $325 × 6 = $1950
Thus, Simple Interest (SI) = $1950
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3250 + $1950
= $5200
Thus, Amount to be paid = $5200 Answer
Similar Questions
(1) Barbara took a loan of $5100 at the rate of 6% simple interest per annum. If he paid an amount of $7854 to clear the loan, then find the time period of the loan.
(2) Nancy took a loan of $6300 at the rate of 9% simple interest per annum. If he paid an amount of $10269 to clear the loan, then find the time period of the loan.
(3) What amount does John have to pay after 5 years if he takes a loan of $3200 at 5% simple interest?
(4) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 9% simple interest.
(5) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 6% simple interest?
(6) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 10% simple interest?
(7) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 10% simple interest for 4 years.
(8) Matthew took a loan of $6400 at the rate of 8% simple interest per annum. If he paid an amount of $9984 to clear the loan, then find the time period of the loan.
(9) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 7% simple interest?
(10) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 8% simple interest?