Question:
What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 10% simple interest?
Correct Answer
$6240
Solution And Explanation
Solution
Given,
Principal (P) = $3900
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) = $3900 × 10% × 6
= $3900 ×10/100 × 6
= 3900 × 10 × 6/100
= 39000 × 6/100
= 234000/100
= $2340
Thus, Simple Interest = $2340
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 = $3900 + $2340
= $6240
Thus, Amount to be paid = $6240 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 = $3900
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 6 years
Thus, Amount (A)
= $3900 + ($3900 × 10% × 6)
= $3900 + ($3900 ×10/100 × 6)
= $3900 + (3900 × 10 × 6/100)
= $3900 + (39000 × 6/100)
= $3900 + (234000/100)
= $3900 + $2340 = $6240
Thus, Amount (A) to be paid = $6240 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 $3900, the simple interest in 1 year
= 10/100 × 3900
= 10 × 3900/100
= 39000/100 = $390
Thus, simple interest for 1 year = $390
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $390 × 6 = $2340
Thus, Simple Interest (SI) = $2340
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3900 + $2340
= $6240
Thus, Amount to be paid = $6240 Answer
Similar Questions
(1) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $7172 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due if Robert borrowed a sum of $3100 at 9% simple interest for 3 years.
(3) If Michelle paid $5940 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(4) Find the amount to be paid if Susan borrowed a sum of $5650 at 7% simple interest for 7 years.
(5) Calculate the amount due if Jennifer borrowed a sum of $3250 at 4% simple interest for 4 years.
(6) Matthew took a loan of $6400 at the rate of 9% simple interest per annum. If he paid an amount of $9856 to clear the loan, then find the time period of the loan.
(7) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 4% simple interest?
(8) Calculate the amount due if Jessica borrowed a sum of $3750 at 6% simple interest for 4 years.
(9) Calculate the amount due if James borrowed a sum of $3000 at 9% simple interest for 3 years.
(10) Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 10% simple interest.