Question:
Find the amount to be paid if Robert borrowed a sum of $5100 at 2% simple interest for 8 years.
Correct Answer
$5916
Solution And Explanation
Solution
Given,
Principal (P) = $5100
Rate of Simple Interest (SI) = 2%
Time (t) = 8 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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) = $5100 × 2% × 8
= $5100 ×2/100 × 8
= 5100 × 2 × 8/100
= 10200 × 8/100
= 81600/100
= $816
Thus, Simple Interest = $816
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 = $5100 + $816
= $5916
Thus, Amount to be paid = $5916 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 = $5100
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 8 years
Thus, Amount (A)
= $5100 + ($5100 × 2% × 8)
= $5100 + ($5100 ×2/100 × 8)
= $5100 + (5100 × 2 × 8/100)
= $5100 + (10200 × 8/100)
= $5100 + (81600/100)
= $5100 + $816 = $5916
Thus, Amount (A) to be paid = $5916 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 2%
This, means, $2 per $100 per year
∵ For $100, the simple interest for 1 year = $2
∴ For $1, the simple interest for 1 year = 2/100
∴ For $5100, the simple interest in 1 year
= 2/100 × 5100
= 2 × 5100/100
= 10200/100 = $102
Thus, simple interest for 1 year = $102
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $102 × 8 = $816
Thus, Simple Interest (SI) = $816
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5100 + $816
= $5916
Thus, Amount to be paid = $5916 Answer
Similar Questions
(1) Find the amount to be paid if Thomas borrowed a sum of $5800 at 9% simple interest for 7 years.
(2) William took a loan of $5000 at the rate of 10% simple interest per annum. If he paid an amount of $8500 to clear the loan, then find the time period of the loan.
(3) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 7% simple interest?
(4) Calculate the amount due if Christopher borrowed a sum of $4000 at 8% simple interest for 4 years.
(5) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 2% simple interest.
(6) Karen took a loan of $5900 at the rate of 8% simple interest per annum. If he paid an amount of $10620 to clear the loan, then find the time period of the loan.
(7) David took a loan of $4800 at the rate of 10% simple interest per annum. If he paid an amount of $8160 to clear the loan, then find the time period of the loan.
(8) Richard took a loan of $5200 at the rate of 6% simple interest per annum. If he paid an amount of $7072 to clear the loan, then find the time period of the loan.
(9) How much loan did Daniel borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7625 to clear it?
(10) Jessica took a loan of $5500 at the rate of 7% simple interest per annum. If he paid an amount of $8965 to clear the loan, then find the time period of the loan.