Question:
Find the amount to be paid if Jennifer borrowed a sum of $5250 at 3% simple interest for 8 years.
Correct Answer
$6510
Solution And Explanation
Solution
Given,
Principal (P) = $5250
Rate of Simple Interest (SI) = 3%
Time (t) = 8 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $5250 × 3% × 8
= $5250 ×3/100 × 8
= 5250 × 3 × 8/100
= 15750 × 8/100
= 126000/100
= $1260
Thus, Simple Interest = $1260
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 = $5250 + $1260
= $6510
Thus, Amount to be paid = $6510 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 = $5250
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 8 years
Thus, Amount (A)
= $5250 + ($5250 × 3% × 8)
= $5250 + ($5250 ×3/100 × 8)
= $5250 + (5250 × 3 × 8/100)
= $5250 + (15750 × 8/100)
= $5250 + (126000/100)
= $5250 + $1260 = $6510
Thus, Amount (A) to be paid = $6510 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $5250, the simple interest in 1 year
= 3/100 × 5250
= 3 × 5250/100
= 15750/100 = $157.5
Thus, simple interest for 1 year = $157.5
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $157.5 × 8 = $1260
Thus, Simple Interest (SI) = $1260
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5250 + $1260
= $6510
Thus, Amount to be paid = $6510 Answer
Similar Questions
(1) Barbara took a loan of $5100 at the rate of 6% simple interest per annum. If he paid an amount of $7242 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 9% simple interest.
(3) Calculate the amount due if Christopher borrowed a sum of $4000 at 10% simple interest for 4 years.
(4) James had to pay $3360 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(5) Calculate the amount due if Jennifer borrowed a sum of $3250 at 5% simple interest for 4 years.
(6) Elizabeth took a loan of $4900 at the rate of 10% simple interest per annum. If he paid an amount of $8820 to clear the loan, then find the time period of the loan.
(7) Calculate the amount due if Robert borrowed a sum of $3100 at 8% simple interest for 4 years.
(8) Ashley had to pay $5096 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(9) How much loan did Ashley borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7860 to clear it?
(10) Find the amount to be paid if Barbara borrowed a sum of $5550 at 9% simple interest for 7 years.