Question:
Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 3% simple interest.
Correct Answer
$6350
Solution And Explanation
Solution
Given,
Principal (P) = $5000
Rate of Simple Interest (SI) = 3%
Time (t) = 9 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $5000 × 3% × 9
= $5000 ×3/100 × 9
= 5000 × 3 × 9/100
= 15000 × 9/100
= 135000/100
= $1350
Thus, Simple Interest = $1350
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 = $5000 + $1350
= $6350
Thus, Amount to be paid = $6350 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 = $5000
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 9 years
Thus, Amount (A)
= $5000 + ($5000 × 3% × 9)
= $5000 + ($5000 ×3/100 × 9)
= $5000 + (5000 × 3 × 9/100)
= $5000 + (15000 × 9/100)
= $5000 + (135000/100)
= $5000 + $1350 = $6350
Thus, Amount (A) to be paid = $6350 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $5000, the simple interest in 1 year
= 3/100 × 5000
= 3 × 5000/100
= 15000/100 = $150
Thus, simple interest for 1 year = $150
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $150 × 9 = $1350
Thus, Simple Interest (SI) = $1350
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5000 + $1350
= $6350
Thus, Amount to be paid = $6350 Answer
Similar Questions
(1) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 4% simple interest?
(2) How much loan did Cynthia borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8745 to clear it?
(3) Find the amount to be paid if Joseph borrowed a sum of $5700 at 9% simple interest for 8 years.
(4) Calculate the amount due if Linda borrowed a sum of $3350 at 10% simple interest for 4 years.
(5) Calculate the amount due after 9 years if Joseph borrowed a sum of $5700 at a rate of 8% simple interest.
(6) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $7952 to clear the loan, then find the time period of the loan.
(7) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 6% simple interest?
(8) Matthew took a loan of $6400 at the rate of 8% simple interest per annum. If he paid an amount of $11520 to clear the loan, then find the time period of the loan.
(9) What amount will be due after 2 years if Mark borrowed a sum of $3700 at a 9% simple interest?
(10) Find the amount to be paid if Christopher borrowed a sum of $6000 at 2% simple interest for 8 years.