Question:
Calculate the amount due after 9 years if David borrowed a sum of $5400 at a rate of 4% simple interest.
Correct Answer
$7344
Solution And Explanation
Solution
Given,
Principal (P) = $5400
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) = $5400 × 4% × 9
= $5400 ×4/100 × 9
= 5400 × 4 × 9/100
= 21600 × 9/100
= 194400/100
= $1944
Thus, Simple Interest = $1944
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 = $5400 + $1944
= $7344
Thus, Amount to be paid = $7344 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 = $5400
Rate of Simple Interest (SI) or (R) = 4%
And, Time (t) = 9 years
Thus, Amount (A)
= $5400 + ($5400 × 4% × 9)
= $5400 + ($5400 ×4/100 × 9)
= $5400 + (5400 × 4 × 9/100)
= $5400 + (21600 × 9/100)
= $5400 + (194400/100)
= $5400 + $1944 = $7344
Thus, Amount (A) to be paid = $7344 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 $5400, the simple interest in 1 year
= 4/100 × 5400
= 4 × 5400/100
= 21600/100 = $216
Thus, simple interest for 1 year = $216
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $216 × 9 = $1944
Thus, Simple Interest (SI) = $1944
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5400 + $1944
= $7344
Thus, Amount to be paid = $7344 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 7% simple interest.
(2) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 7% simple interest.
(3) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.
(4) If David paid $4080 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(5) If Mary borrowed $3050 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(6) Find the amount to be paid if Richard borrowed a sum of $5600 at 6% simple interest for 7 years.
(7) Find the amount to be paid if Mary borrowed a sum of $5050 at 10% simple interest for 8 years.
(8) How much loan did Jason borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9625 to clear it?
(9) Calculate the amount due after 10 years if James borrowed a sum of $5000 at a rate of 4% simple interest.
(10) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 10% simple interest.