Question:
Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 2% simple interest.
Correct Answer
$6608
Solution And Explanation
Solution
Given,
Principal (P) = $5600
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) = $5600 × 2% × 9
= $5600 ×2/100 × 9
= 5600 × 2 × 9/100
= 11200 × 9/100
= 100800/100
= $1008
Thus, Simple Interest = $1008
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 = $5600 + $1008
= $6608
Thus, Amount to be paid = $6608 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 = $5600
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 9 years
Thus, Amount (A)
= $5600 + ($5600 × 2% × 9)
= $5600 + ($5600 ×2/100 × 9)
= $5600 + (5600 × 2 × 9/100)
= $5600 + (11200 × 9/100)
= $5600 + (100800/100)
= $5600 + $1008 = $6608
Thus, Amount (A) to be paid = $6608 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 $5600, the simple interest in 1 year
= 2/100 × 5600
= 2 × 5600/100
= 11200/100 = $112
Thus, simple interest for 1 year = $112
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $112 × 9 = $1008
Thus, Simple Interest (SI) = $1008
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $1008
= $6608
Thus, Amount to be paid = $6608 Answer
Similar Questions
(1) Margaret took a loan of $6700 at the rate of 10% simple interest per annum. If he paid an amount of $12060 to clear the loan, then find the time period of the loan.
(2) If Matthew paid $4536 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(3) Find the amount to be paid if Joseph borrowed a sum of $5700 at 10% simple interest for 8 years.
(4) In how much time a principal of $3200 will amount to $3520 at a simple interest of 2% per annum?
(5) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 6% simple interest.
(6) Christopher took a loan of $6000 at the rate of 7% simple interest per annum. If he paid an amount of $8940 to clear the loan, then find the time period of the loan.
(7) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 3% simple interest?
(8) How much loan did Brian borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9000 to clear it?
(9) Find the amount to be paid if Sarah borrowed a sum of $5850 at 3% simple interest for 8 years.
(10) How much loan did Ashley borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7532.5 to clear it?