Question:
What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 10% simple interest?
Correct Answer
$5680
Solution And Explanation
Solution
Given,
Principal (P) = $3550
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) = $3550 × 10% × 6
= $3550 ×10/100 × 6
= 3550 × 10 × 6/100
= 35500 × 6/100
= 213000/100
= $2130
Thus, Simple Interest = $2130
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 = $3550 + $2130
= $5680
Thus, Amount to be paid = $5680 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 = $3550
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 6 years
Thus, Amount (A)
= $3550 + ($3550 × 10% × 6)
= $3550 + ($3550 ×10/100 × 6)
= $3550 + (3550 × 10 × 6/100)
= $3550 + (35500 × 6/100)
= $3550 + (213000/100)
= $3550 + $2130 = $5680
Thus, Amount (A) to be paid = $5680 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 $3550, the simple interest in 1 year
= 10/100 × 3550
= 10 × 3550/100
= 35500/100 = $355
Thus, simple interest for 1 year = $355
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $355 × 6 = $2130
Thus, Simple Interest (SI) = $2130
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $2130
= $5680
Thus, Amount to be paid = $5680 Answer
Similar Questions
(1) How much loan did Matthew borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6820 to clear it?
(2) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 5% simple interest?
(3) Lisa took a loan of $6100 at the rate of 9% simple interest per annum. If he paid an amount of $11041 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if James borrowed a sum of $5000 at 5% simple interest for 7 years.
(5) Calculate the amount due if Christopher borrowed a sum of $4000 at 3% simple interest for 4 years.
(6) How much loan did Nancy borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6765 to clear it?
(7) Jessica had to pay $4087.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(8) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $7956 to clear the loan, then find the time period of the loan.
(9) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $7392 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if Joseph borrowed a sum of $3700 at 7% simple interest for 4 years.