Question:
What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 10% simple interest?
Correct Answer
$6080
Solution And Explanation
Solution
Given,
Principal (P) = $3800
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) = $3800 × 10% × 6
= $3800 ×10/100 × 6
= 3800 × 10 × 6/100
= 38000 × 6/100
= 228000/100
= $2280
Thus, Simple Interest = $2280
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 = $3800 + $2280
= $6080
Thus, Amount to be paid = $6080 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 = $3800
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 6 years
Thus, Amount (A)
= $3800 + ($3800 × 10% × 6)
= $3800 + ($3800 ×10/100 × 6)
= $3800 + (3800 × 10 × 6/100)
= $3800 + (38000 × 6/100)
= $3800 + (228000/100)
= $3800 + $2280 = $6080
Thus, Amount (A) to be paid = $6080 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 $3800, the simple interest in 1 year
= 10/100 × 3800
= 10 × 3800/100
= 38000/100 = $380
Thus, simple interest for 1 year = $380
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $380 × 6 = $2280
Thus, Simple Interest (SI) = $2280
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $2280
= $6080
Thus, Amount to be paid = $6080 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Patricia borrowed a sum of $5150 at a rate of 9% simple interest.
(2) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7647.5 to clear it?
(3) Calculate the amount due after 9 years if Christopher borrowed a sum of $6000 at a rate of 4% simple interest.
(4) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 5% simple interest for 4 years.
(5) Find the amount to be paid if Joseph borrowed a sum of $5700 at 6% simple interest for 7 years.
(6) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 6% simple interest?
(7) Find the amount to be paid if Jessica borrowed a sum of $5750 at 7% simple interest for 7 years.
(8) Daniel took a loan of $6200 at the rate of 7% simple interest per annum. If he paid an amount of $10540 to clear the loan, then find the time period of the loan.
(9) Matthew took a loan of $6400 at the rate of 9% simple interest per annum. If he paid an amount of $12160 to clear the loan, then find the time period of the loan.
(10) Patricia took a loan of $4300 at the rate of 8% simple interest per annum. If he paid an amount of $7052 to clear the loan, then find the time period of the loan.