Question:
What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 10% simple interest?
Correct Answer
$5840
Solution And Explanation
Solution
Given,
Principal (P) = $3650
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) = $3650 × 10% × 6
= $3650 ×10/100 × 6
= 3650 × 10 × 6/100
= 36500 × 6/100
= 219000/100
= $2190
Thus, Simple Interest = $2190
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 = $3650 + $2190
= $5840
Thus, Amount to be paid = $5840 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 = $3650
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 6 years
Thus, Amount (A)
= $3650 + ($3650 × 10% × 6)
= $3650 + ($3650 ×10/100 × 6)
= $3650 + (3650 × 10 × 6/100)
= $3650 + (36500 × 6/100)
= $3650 + (219000/100)
= $3650 + $2190 = $5840
Thus, Amount (A) to be paid = $5840 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 $3650, the simple interest in 1 year
= 10/100 × 3650
= 10 × 3650/100
= 36500/100 = $365
Thus, simple interest for 1 year = $365
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $365 × 6 = $2190
Thus, Simple Interest (SI) = $2190
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $2190
= $5840
Thus, Amount to be paid = $5840 Answer
Similar Questions
(1) Calculate the amount due if Karen borrowed a sum of $3950 at 4% simple interest for 3 years.
(2) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 2% simple interest.
(3) Donald took a loan of $7000 at the rate of 10% simple interest per annum. If he paid an amount of $13300 to clear the loan, then find the time period of the loan.
(4) Sarah had to pay $4081 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(5) If Linda paid $3886 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(6) What amount does David have to pay after 5 years if he takes a loan of $3400 at 6% simple interest?
(7) Find the amount to be paid if Sarah borrowed a sum of $5850 at 6% simple interest for 8 years.
(8) What amount does Sarah have to pay after 5 years if he takes a loan of $3850 at 4% simple interest?
(9) What amount does Jessica have to pay after 5 years if he takes a loan of $3750 at 3% simple interest?
(10) Find the amount to be paid if Joseph borrowed a sum of $5700 at 6% simple interest for 8 years.