Question:
Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 2% simple interest.
Correct Answer
$6844
Solution And Explanation
Solution
Given,
Principal (P) = $5800
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) = $5800 × 2% × 9
= $5800 ×2/100 × 9
= 5800 × 2 × 9/100
= 11600 × 9/100
= 104400/100
= $1044
Thus, Simple Interest = $1044
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 = $5800 + $1044
= $6844
Thus, Amount to be paid = $6844 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 = $5800
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 9 years
Thus, Amount (A)
= $5800 + ($5800 × 2% × 9)
= $5800 + ($5800 ×2/100 × 9)
= $5800 + (5800 × 2 × 9/100)
= $5800 + (11600 × 9/100)
= $5800 + (104400/100)
= $5800 + $1044 = $6844
Thus, Amount (A) to be paid = $6844 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 $5800, the simple interest in 1 year
= 2/100 × 5800
= 2 × 5800/100
= 11600/100 = $116
Thus, simple interest for 1 year = $116
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $116 × 9 = $1044
Thus, Simple Interest (SI) = $1044
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $1044
= $6844
Thus, Amount to be paid = $6844 Answer
Similar Questions
(1) Find the amount to be paid if Karen borrowed a sum of $5950 at 3% simple interest for 8 years.
(2) Barbara took a loan of $5100 at the rate of 9% simple interest per annum. If he paid an amount of $9690 to clear the loan, then find the time period of the loan.
(3) Lisa took a loan of $6100 at the rate of 6% simple interest per annum. If he paid an amount of $9028 to clear the loan, then find the time period of the loan.
(4) In how much time a principal of $3150 will amount to $3339 at a simple interest of 3% per annum?
(5) Lisa took a loan of $6100 at the rate of 7% simple interest per annum. If he paid an amount of $10370 to clear the loan, then find the time period of the loan.
(6) Karen took a loan of $5900 at the rate of 10% simple interest per annum. If he paid an amount of $9440 to clear the loan, then find the time period of the loan.
(7) Elizabeth took a loan of $4900 at the rate of 8% simple interest per annum. If he paid an amount of $7252 to clear the loan, then find the time period of the loan.
(8) Find the amount to be paid if John borrowed a sum of $5200 at 4% simple interest for 7 years.
(9) In how much time a principal of $3150 will amount to $3276 at a simple interest of 2% per annum?
(10) Kenneth had to pay $5750 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.