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 if Mary borrowed a sum of $3050 at 8% simple interest for 4 years.
(2) If Lisa paid $4374 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(3) Sandra had to pay $5117.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(4) What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 6% simple interest?
(5) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $7616 to clear the loan, then find the time period of the loan.
(6) Anthony took a loan of $6600 at the rate of 9% simple interest per annum. If he paid an amount of $10758 to clear the loan, then find the time period of the loan.
(7) Find the amount to be paid if Joseph borrowed a sum of $5700 at 3% simple interest for 7 years.
(8) Karen took a loan of $5900 at the rate of 9% simple interest per annum. If he paid an amount of $10148 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if Linda borrowed a sum of $5350 at 8% simple interest for 7 years.
(10) Find the amount to be paid if Barbara borrowed a sum of $5550 at 6% simple interest for 8 years.