Question:
Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 3% simple interest.
Correct Answer
$7112
Solution And Explanation
Solution
Given,
Principal (P) = $5600
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) = $5600 × 3% × 9
= $5600 ×3/100 × 9
= 5600 × 3 × 9/100
= 16800 × 9/100
= 151200/100
= $1512
Thus, Simple Interest = $1512
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 = $5600 + $1512
= $7112
Thus, Amount to be paid = $7112 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 = $5600
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 9 years
Thus, Amount (A)
= $5600 + ($5600 × 3% × 9)
= $5600 + ($5600 ×3/100 × 9)
= $5600 + (5600 × 3 × 9/100)
= $5600 + (16800 × 9/100)
= $5600 + (151200/100)
= $5600 + $1512 = $7112
Thus, Amount (A) to be paid = $7112 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 $5600, the simple interest in 1 year
= 3/100 × 5600
= 3 × 5600/100
= 16800/100 = $168
Thus, simple interest for 1 year = $168
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $168 × 9 = $1512
Thus, Simple Interest (SI) = $1512
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $1512
= $7112
Thus, Amount to be paid = $7112 Answer
Similar Questions
(1) William took a loan of $5000 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.
(2) If Michael paid $3696 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(3) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 7% simple interest?
(4) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 6% simple interest?
(5) 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.
(6) Calculate the amount due if Jessica borrowed a sum of $3750 at 4% simple interest for 4 years.
(7) David took a loan of $4800 at the rate of 8% simple interest per annum. If he paid an amount of $7488 to clear the loan, then find the time period of the loan.
(8) How much loan did Mary borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $5807.5 to clear it?
(9) Calculate the amount due if John borrowed a sum of $3200 at 4% simple interest for 3 years.
(10) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 5% simple interest.