Question:
Calculate the amount due after 9 years if David borrowed a sum of $5400 at a rate of 2% simple interest.
Correct Answer
$6372
Solution And Explanation
Solution
Given,
Principal (P) = $5400
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) = $5400 × 2% × 9
= $5400 ×2/100 × 9
= 5400 × 2 × 9/100
= 10800 × 9/100
= 97200/100
= $972
Thus, Simple Interest = $972
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 = $5400 + $972
= $6372
Thus, Amount to be paid = $6372 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 = $5400
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 9 years
Thus, Amount (A)
= $5400 + ($5400 × 2% × 9)
= $5400 + ($5400 ×2/100 × 9)
= $5400 + (5400 × 2 × 9/100)
= $5400 + (10800 × 9/100)
= $5400 + (97200/100)
= $5400 + $972 = $6372
Thus, Amount (A) to be paid = $6372 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 $5400, the simple interest in 1 year
= 2/100 × 5400
= 2 × 5400/100
= 10800/100 = $108
Thus, simple interest for 1 year = $108
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $108 × 9 = $972
Thus, Simple Interest (SI) = $972
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5400 + $972
= $6372
Thus, Amount to be paid = $6372 Answer
Similar Questions
(1) Calculate the amount due if William borrowed a sum of $3500 at 5% simple interest for 3 years.
(2) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 7% simple interest.
(3) In how much time a principal of $3100 will amount to $3410 at a simple interest of 2% per annum?
(4) Find the amount to be paid if Barbara borrowed a sum of $5550 at 5% simple interest for 7 years.
(5) Find the amount to be paid if Thomas borrowed a sum of $5800 at 4% simple interest for 8 years.
(6) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 7% simple interest.
(7) If Susan paid $4088 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(8) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 8% simple interest.
(9) What amount does David have to pay after 5 years if he takes a loan of $3400 at 6% simple interest?
(10) If Donna paid $5820 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.