Question:
Calculate the amount due after 9 years if Joseph borrowed a sum of $5700 at a rate of 2% simple interest.
Correct Answer
$6726
Solution And Explanation
Solution
Given,
Principal (P) = $5700
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) = $5700 × 2% × 9
= $5700 ×2/100 × 9
= 5700 × 2 × 9/100
= 11400 × 9/100
= 102600/100
= $1026
Thus, Simple Interest = $1026
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 = $5700 + $1026
= $6726
Thus, Amount to be paid = $6726 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 = $5700
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 9 years
Thus, Amount (A)
= $5700 + ($5700 × 2% × 9)
= $5700 + ($5700 ×2/100 × 9)
= $5700 + (5700 × 2 × 9/100)
= $5700 + (11400 × 9/100)
= $5700 + (102600/100)
= $5700 + $1026 = $6726
Thus, Amount (A) to be paid = $6726 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 $5700, the simple interest in 1 year
= 2/100 × 5700
= 2 × 5700/100
= 11400/100 = $114
Thus, simple interest for 1 year = $114
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $114 × 9 = $1026
Thus, Simple Interest (SI) = $1026
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5700 + $1026
= $6726
Thus, Amount to be paid = $6726 Answer
Similar Questions
(1) Find the amount to be paid if Barbara borrowed a sum of $5550 at 8% simple interest for 7 years.
(2) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 10% simple interest?
(3) Calculate the amount due if Charles borrowed a sum of $3900 at 7% simple interest for 3 years.
(4) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 2% simple interest.
(5) Find the amount to be paid if Michael borrowed a sum of $5300 at 8% simple interest for 7 years.
(6) Anthony took a loan of $6600 at the rate of 9% simple interest per annum. If he paid an amount of $11946 to clear the loan, then find the time period of the loan.
(7) If Jessica borrowed $3750 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(8) If Robert borrowed $3100 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(9) How much loan did William borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6875 to clear it?
(10) What amount does William have to pay after 6 years if he takes a loan of $3500 at 4% simple interest?