Question:
Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 4% simple interest.
Correct Answer
$7072
Solution And Explanation
Solution
Given,
Principal (P) = $5200
Rate of Simple Interest (SI) = 4%
Time (t) = 9 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $5200 × 4% × 9
= $5200 ×4/100 × 9
= 5200 × 4 × 9/100
= 20800 × 9/100
= 187200/100
= $1872
Thus, Simple Interest = $1872
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 = $5200 + $1872
= $7072
Thus, Amount to be paid = $7072 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 = $5200
Rate of Simple Interest (SI) or (R) = 4%
And, Time (t) = 9 years
Thus, Amount (A)
= $5200 + ($5200 × 4% × 9)
= $5200 + ($5200 ×4/100 × 9)
= $5200 + (5200 × 4 × 9/100)
= $5200 + (20800 × 9/100)
= $5200 + (187200/100)
= $5200 + $1872 = $7072
Thus, Amount (A) to be paid = $7072 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 4%
This, means, $4 per $100 per year
∵ For $100, the simple interest for 1 year = $4
∴ For $1, the simple interest for 1 year = 4/100
∴ For $5200, the simple interest in 1 year
= 4/100 × 5200
= 4 × 5200/100
= 20800/100 = $208
Thus, simple interest for 1 year = $208
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $208 × 9 = $1872
Thus, Simple Interest (SI) = $1872
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5200 + $1872
= $7072
Thus, Amount to be paid = $7072 Answer
Similar Questions
(1) Calculate the amount due if William borrowed a sum of $3500 at 5% simple interest for 3 years.
(2) In how much time a principal of $3050 will amount to $3233 at a simple interest of 2% per annum?
(3) What amount will be due after 2 years if Mark borrowed a sum of $3700 at a 5% simple interest?
(4) Donald took a loan of $7000 at the rate of 7% simple interest per annum. If he paid an amount of $11410 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due if Robert borrowed a sum of $3100 at 5% simple interest for 4 years.
(6) What amount will be due after 2 years if David borrowed a sum of $3200 at a 8% simple interest?
(7) If Michelle paid $5544 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(8) Find the amount to be paid if Jessica borrowed a sum of $5750 at 2% simple interest for 7 years.
(9) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 5% simple interest?
(10) What amount does Sarah have to pay after 6 years if he takes a loan of $3850 at 2% simple interest?