Question:
What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 10% simple interest?
Correct Answer
$4875
Solution And Explanation
Solution
Given,
Principal (P) = $3250
Rate of Simple Interest (SI) = 10%
Time (t) = 5 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) = $3250 × 10% × 5
= $3250 ×10/100 × 5
= 3250 × 10 × 5/100
= 32500 × 5/100
= 162500/100
= $1625
Thus, Simple Interest = $1625
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 = $3250 + $1625
= $4875
Thus, Amount to be paid = $4875 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 = $3250
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 5 years
Thus, Amount (A)
= $3250 + ($3250 × 10% × 5)
= $3250 + ($3250 ×10/100 × 5)
= $3250 + (3250 × 10 × 5/100)
= $3250 + (32500 × 5/100)
= $3250 + (162500/100)
= $3250 + $1625 = $4875
Thus, Amount (A) to be paid = $4875 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 $3250, the simple interest in 1 year
= 10/100 × 3250
= 10 × 3250/100
= 32500/100 = $325
Thus, simple interest for 1 year = $325
Therefore, simple interest for 5 years
= Simple interest for 1 year × 5
= $325 × 5 = $1625
Thus, Simple Interest (SI) = $1625
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3250 + $1625
= $4875
Thus, Amount to be paid = $4875 Answer
Similar Questions
(1) Robert took a loan of $4200 at the rate of 9% simple interest per annum. If he paid an amount of $6846 to clear the loan, then find the time period of the loan.
(2) If Jessica paid $4350 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(3) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 3% simple interest.
(4) Find the amount to be paid if Karen borrowed a sum of $5950 at 10% simple interest for 8 years.
(5) How much loan did Matthew borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7440 to clear it?
(6) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 4% simple interest.
(7) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 7% simple interest?
(8) Find the amount to be paid if Barbara borrowed a sum of $5550 at 4% simple interest for 8 years.
(9) Anthony had to pay $4558 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(10) Find the amount to be paid if Jessica borrowed a sum of $5750 at 9% simple interest for 7 years.