Question:
( 1 of 10 ) Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 2% simple interest.
(A) 4 47/50 Or, 247/50
(B) 8 47/50 Or, 447/50
(C) 4 141/50 Or, 341/50
(D) 4 94/50 Or, 294/50
You selected
$5000
Correct Answer
$5900
Solution And Explanation
Solution
Given,
Principal (P) = $5000
Rate of Simple Interest (SI) = 2%
Time (t) = 9 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) = $5000 × 2% × 9
= $5000 ×2/100 × 9
= 5000 × 2 × 9/100
= 10000 × 9/100
= 90000/100
= $900
Thus, Simple Interest = $900
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 = $5000 + $900
= $5900
Thus, Amount to be paid = $5900 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 = $5000
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 9 years
Thus, Amount (A)
= $5000 + ($5000 × 2% × 9)
= $5000 + ($5000 ×2/100 × 9)
= $5000 + (5000 × 2 × 9/100)
= $5000 + (10000 × 9/100)
= $5000 + (90000/100)
= $5000 + $900 = $5900
Thus, Amount (A) to be paid = $5900 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 $5000, the simple interest in 1 year
= 2/100 × 5000
= 2 × 5000/100
= 10000/100 = $100
Thus, simple interest for 1 year = $100
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $100 × 9 = $900
Thus, Simple Interest (SI) = $900
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5000 + $900
= $5900
Thus, Amount to be paid = $5900 Answer
Similar Questions
(1) Find the amount to be paid if Patricia borrowed a sum of $5150 at 7% simple interest for 7 years.
(2) James took a loan of $4000 at the rate of 9% simple interest per annum. If he paid an amount of $7240 to clear the loan, then find the time period of the loan.
(3) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 8% simple interest?
(4) Find the amount to be paid if Charles borrowed a sum of $5900 at 6% simple interest for 7 years.
(5) Find the amount to be paid if Karen borrowed a sum of $5950 at 6% simple interest for 8 years.
(6) Calculate the amount due if David borrowed a sum of $3400 at 6% simple interest for 3 years.
(7) Find the amount to be paid if Joseph borrowed a sum of $5700 at 2% simple interest for 8 years.
(8) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 4% simple interest?
(9) What amount will be due after 2 years if James borrowed a sum of $3000 at a 5% simple interest?
(10) Calculate the amount due if Richard borrowed a sum of $3600 at 5% simple interest for 4 years.