Question:
Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 2% simple interest.
Correct Answer
$6431
Solution And Explanation
Solution
Given,
Principal (P) = $5450
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) = $5450 × 2% × 9
= $5450 ×2/100 × 9
= 5450 × 2 × 9/100
= 10900 × 9/100
= 98100/100
= $981
Thus, Simple Interest = $981
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 + $981
= $6431
Thus, Amount to be paid = $6431 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) = 2%
And, Time (t) = 9 years
Thus, Amount (A)
= $5450 + ($5450 × 2% × 9)
= $5450 + ($5450 ×2/100 × 9)
= $5450 + (5450 × 2 × 9/100)
= $5450 + (10900 × 9/100)
= $5450 + (98100/100)
= $5450 + $981 = $6431
Thus, Amount (A) to be paid = $6431 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 $5450, the simple interest in 1 year
= 2/100 × 5450
= 2 × 5450/100
= 10900/100 = $109
Thus, simple interest for 1 year = $109
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $109 × 9 = $981
Thus, Simple Interest (SI) = $981
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5450 + $981
= $6431
Thus, Amount to be paid = $6431 Answer
Similar Questions
(1) Find the amount to be paid if Karen borrowed a sum of $5950 at 3% simple interest for 7 years.
(2) Elizabeth had to pay $3760.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(3) What amount does David have to pay after 5 years if he takes a loan of $3400 at 6% simple interest?
(4) Find the amount to be paid if Michael borrowed a sum of $5300 at 9% simple interest for 7 years.
(5) Calculate the amount due if Joseph borrowed a sum of $3700 at 2% simple interest for 4 years.
(6) If Emily paid $5700 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(7) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $10212 to clear the loan, then find the time period of the loan.
(8) What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 10% simple interest?
(9) Find the amount to be paid if Jessica borrowed a sum of $5750 at 8% simple interest for 8 years.
(10) Sandra took a loan of $6900 at the rate of 9% simple interest per annum. If he paid an amount of $13110 to clear the loan, then find the time period of the loan.