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) Joseph took a loan of $5400 at the rate of 8% simple interest per annum. If he paid an amount of $9288 to clear the loan, then find the time period of the loan.
(2) Find the amount to be paid if Charles borrowed a sum of $5900 at 3% simple interest for 8 years.
(3) How much loan did Barbara borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6660 to clear it?
(4) What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 7% simple interest?
(5) Joseph took a loan of $5400 at the rate of 7% simple interest per annum. If he paid an amount of $7668 to clear the loan, then find the time period of the loan.
(6) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 8% simple interest?
(7) If Linda borrowed $3350 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(8) Michael took a loan of $4600 at the rate of 8% simple interest per annum. If he paid an amount of $8280 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if Mary borrowed a sum of $5050 at 6% simple interest for 7 years.
(10) Calculate the amount due if Susan borrowed a sum of $3650 at 7% simple interest for 4 years.