Question:
Find the amount to be paid if Jennifer borrowed a sum of $5250 at 9% simple interest for 8 years.
Correct Answer
$9030
Solution And Explanation
Solution
Given,
Principal (P) = $5250
Rate of Simple Interest (SI) = 9%
Time (t) = 8 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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 × 9% × 8
= $5250 ×9/100 × 8
= 5250 × 9 × 8/100
= 47250 × 8/100
= 378000/100
= $3780
Thus, Simple Interest = $3780
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 + $3780
= $9030
Thus, Amount to be paid = $9030 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) = 9%
And, Time (t) = 8 years
Thus, Amount (A)
= $5250 + ($5250 × 9% × 8)
= $5250 + ($5250 ×9/100 × 8)
= $5250 + (5250 × 9 × 8/100)
= $5250 + (47250 × 8/100)
= $5250 + (378000/100)
= $5250 + $3780 = $9030
Thus, Amount (A) to be paid = $9030 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $5250, the simple interest in 1 year
= 9/100 × 5250
= 9 × 5250/100
= 47250/100 = $472.5
Thus, simple interest for 1 year = $472.5
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $472.5 × 8 = $3780
Thus, Simple Interest (SI) = $3780
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5250 + $3780
= $9030
Thus, Amount to be paid = $9030 Answer
Similar Questions
(1) Calculate the amount due if Joseph borrowed a sum of $3700 at 10% simple interest for 3 years.
(2) Calculate the amount due if Thomas borrowed a sum of $3800 at 8% simple interest for 4 years.
(3) What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 2% simple interest?
(4) If Jennifer borrowed $3250 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(5) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 2% simple interest.
(6) Calculate the amount due if Michael borrowed a sum of $3300 at 10% simple interest for 3 years.
(7) Calculate the amount due after 9 years if Charles borrowed a sum of $5900 at a rate of 2% simple interest.
(8) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $8480 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due if Mary borrowed a sum of $3050 at 2% simple interest for 4 years.
(10) Calculate the amount due if Jessica borrowed a sum of $3750 at 6% simple interest for 4 years.