Question:
Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 2% simple interest.
Correct Answer
$5959
Solution And Explanation
Solution
Given,
Principal (P) = $5050
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) = $5050 × 2% × 9
= $5050 ×2/100 × 9
= 5050 × 2 × 9/100
= 10100 × 9/100
= 90900/100
= $909
Thus, Simple Interest = $909
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 = $5050 + $909
= $5959
Thus, Amount to be paid = $5959 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 = $5050
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 9 years
Thus, Amount (A)
= $5050 + ($5050 × 2% × 9)
= $5050 + ($5050 ×2/100 × 9)
= $5050 + (5050 × 2 × 9/100)
= $5050 + (10100 × 9/100)
= $5050 + (90900/100)
= $5050 + $909 = $5959
Thus, Amount (A) to be paid = $5959 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 $5050, the simple interest in 1 year
= 2/100 × 5050
= 2 × 5050/100
= 10100/100 = $101
Thus, simple interest for 1 year = $101
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $101 × 9 = $909
Thus, Simple Interest (SI) = $909
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5050 + $909
= $5959
Thus, Amount to be paid = $5959 Answer
Similar Questions
(1) If Barbara borrowed $3550 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(2) Michael took a loan of $4600 at the rate of 7% simple interest per annum. If he paid an amount of $7176 to clear the loan, then find the time period of the loan.
(3) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $8100 to clear the loan, then find the time period of the loan.
(4) What amount will be due after 2 years if Joshua borrowed a sum of $3950 at a 4% simple interest?
(5) What amount will be due after 2 years if Steven borrowed a sum of $3800 at a 7% simple interest?
(6) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 5% simple interest.
(7) If Jennifer paid $3510 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(8) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 6% simple interest?
(9) Calculate the amount due if Susan borrowed a sum of $3650 at 4% simple interest for 4 years.
(10) Jessica took a loan of $5500 at the rate of 10% simple interest per annum. If he paid an amount of $8800 to clear the loan, then find the time period of the loan.