Question:
( 3 of 10 ) What amount does Sarah have to pay after 5 years if he takes a loan of $3850 at 5% simple interest?
(A) 11 19/46 days or 11.413 days
(B) 22 19/46 days or 22.413 days
(C) 46 days
(D) 23 days
You selected
$3850
Correct Answer
$4812.5
Solution And Explanation
Solution
Given,
Principal (P) = $3850
Rate of Simple Interest (SI) = 5%
Time (t) = 5 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $3850 × 5% × 5
= $3850 ×5/100 × 5
= 3850 × 5 × 5/100
= 19250 × 5/100
= 96250/100
= $962.5
Thus, Simple Interest = $962.5
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 = $3850 + $962.5
= $4812.5
Thus, Amount to be paid = $4812.5 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 = $3850
Rate of Simple Interest (SI) or (R) = 5%
And, Time (t) = 5 years
Thus, Amount (A)
= $3850 + ($3850 × 5% × 5)
= $3850 + ($3850 ×5/100 × 5)
= $3850 + (3850 × 5 × 5/100)
= $3850 + (19250 × 5/100)
= $3850 + (96250/100)
= $3850 + $962.5 = $4812.5
Thus, Amount (A) to be paid = $4812.5 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 5%
This, means, $5 per $100 per year
∵ For $100, the simple interest for 1 year = $5
∴ For $1, the simple interest for 1 year = 5/100
∴ For $3850, the simple interest in 1 year
= 5/100 × 3850
= 5 × 3850/100
= 19250/100 = $192.5
Thus, simple interest for 1 year = $192.5
Therefore, simple interest for 5 years
= Simple interest for 1 year × 5
= $192.5 × 5 = $962.5
Thus, Simple Interest (SI) = $962.5
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3850 + $962.5
= $4812.5
Thus, Amount to be paid = $4812.5 Answer
Similar Questions
(1) In how much time a principal of $3050 will amount to $3507.5 at a simple interest of 3% per annum?
(2) Calculate the amount due if Joseph borrowed a sum of $3700 at 6% simple interest for 4 years.
(3) Calculate the amount due if Christopher borrowed a sum of $4000 at 4% simple interest for 4 years.
(4) Find the amount to be paid if Robert borrowed a sum of $5100 at 10% simple interest for 8 years.
(5) James took a loan of $4000 at the rate of 6% simple interest per annum. If he paid an amount of $5680 to clear the loan, then find the time period of the loan.
(6) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $8400 to clear the loan, then find the time period of the loan.
(7) Robert took a loan of $4200 at the rate of 6% simple interest per annum. If he paid an amount of $5712 to clear the loan, then find the time period of the loan.
(8) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 9% simple interest?
(9) How much loan did Cynthia borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $9142.5 to clear it?
(10) Sarah took a loan of $5700 at the rate of 9% simple interest per annum. If he paid an amount of $10317 to clear the loan, then find the time period of the loan.