Question:
( 1 of 10 ) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 5% simple interest for 8 years.
(A) 59
(B) 30.5
(C) 61
(D) 60
You selected
$5450
Correct Answer
$7630
Solution And Explanation
Solution
Given,
Principal (P) = $5450
Rate of Simple Interest (SI) = 5%
Time (t) = 8 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) = $5450 × 5% × 8
= $5450 ×5/100 × 8
= 5450 × 5 × 8/100
= 27250 × 8/100
= 218000/100
= $2180
Thus, Simple Interest = $2180
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 = $5450 + $2180
= $7630
Thus, Amount to be paid = $7630 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 = $5450
Rate of Simple Interest (SI) or (R) = 5%
And, Time (t) = 8 years
Thus, Amount (A)
= $5450 + ($5450 × 5% × 8)
= $5450 + ($5450 ×5/100 × 8)
= $5450 + (5450 × 5 × 8/100)
= $5450 + (27250 × 8/100)
= $5450 + (218000/100)
= $5450 + $2180 = $7630
Thus, Amount (A) to be paid = $7630 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 $5450, the simple interest in 1 year
= 5/100 × 5450
= 5 × 5450/100
= 27250/100 = $272.5
Thus, simple interest for 1 year = $272.5
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $272.5 × 8 = $2180
Thus, Simple Interest (SI) = $2180
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5450 + $2180
= $7630
Thus, Amount to be paid = $7630 Answer
Similar Questions
(1) Calculate the amount due if Susan borrowed a sum of $3650 at 4% simple interest for 4 years.
(2) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 8% simple interest.
(3) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 8% simple interest.
(4) If Margaret paid $5046 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(5) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 5% simple interest.
(6) Find the amount to be paid if Jessica borrowed a sum of $5750 at 4% simple interest for 7 years.
(7) Calculate the amount due if Michael borrowed a sum of $3300 at 3% simple interest for 4 years.
(8) How much loan did Anthony borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7875 to clear it?
(9) Michael took a loan of $4600 at the rate of 7% simple interest per annum. If he paid an amount of $6532 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 3% simple interest for 4 years.