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) In how much time a principal of $3000 will amount to $3450 at a simple interest of 3% per annum?
(2) How much loan did Jeffrey borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8580 to clear it?
(3) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 3% simple interest for 8 years.
(4) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 9% simple interest.
(5) Michael took a loan of $4600 at the rate of 8% simple interest per annum. If he paid an amount of $6808 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 7% simple interest.
(7) Find the amount to be paid if James borrowed a sum of $5000 at 3% simple interest for 7 years.
(8) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 9% simple interest?
(9) Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $8140 to clear the loan, then find the time period of the loan.
(10) Anthony took a loan of $6600 at the rate of 9% simple interest per annum. If he paid an amount of $12540 to clear the loan, then find the time period of the loan.