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) How much loan did Linda borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5885 to clear it?
(2) How much loan did Anthony borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7245 to clear it?
(3) Calculate the amount due after 10 years if Mary borrowed a sum of $5050 at a rate of 5% simple interest.
(4) Michael took a loan of $4600 at the rate of 10% simple interest per annum. If he paid an amount of $9200 to clear the loan, then find the time period of the loan.
(5) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 4% simple interest?
(6) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 3% simple interest.
(7) James took a loan of $4000 at the rate of 10% simple interest per annum. If he paid an amount of $8000 to clear the loan, then find the time period of the loan.
(8) Lisa took a loan of $6100 at the rate of 8% simple interest per annum. If he paid an amount of $10492 to clear the loan, then find the time period of the loan.
(9) If Joseph paid $4144 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(10) Elizabeth took a loan of $4900 at the rate of 6% simple interest per annum. If he paid an amount of $6664 to clear the loan, then find the time period of the loan.