Question:
Calculate the amount due after 9 years if Barbara borrowed a sum of $5550 at a rate of 4% simple interest.
Correct Answer
$7548
Solution And Explanation
Solution
Given,
Principal (P) = $5550
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) = $5550 × 4% × 9
= $5550 ×4/100 × 9
= 5550 × 4 × 9/100
= 22200 × 9/100
= 199800/100
= $1998
Thus, Simple Interest = $1998
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 = $5550 + $1998
= $7548
Thus, Amount to be paid = $7548 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 = $5550
Rate of Simple Interest (SI) or (R) = 4%
And, Time (t) = 9 years
Thus, Amount (A)
= $5550 + ($5550 × 4% × 9)
= $5550 + ($5550 ×4/100 × 9)
= $5550 + (5550 × 4 × 9/100)
= $5550 + (22200 × 9/100)
= $5550 + (199800/100)
= $5550 + $1998 = $7548
Thus, Amount (A) to be paid = $7548 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 $5550, the simple interest in 1 year
= 4/100 × 5550
= 4 × 5550/100
= 22200/100 = $222
Thus, simple interest for 1 year = $222
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $222 × 9 = $1998
Thus, Simple Interest (SI) = $1998
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5550 + $1998
= $7548
Thus, Amount to be paid = $7548 Answer
Similar Questions
(1) Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $11247 to clear the loan, then find the time period of the loan.
(2) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 3% simple interest?
(3) Barbara took a loan of $5100 at the rate of 10% simple interest per annum. If he paid an amount of $8670 to clear the loan, then find the time period of the loan.
(4) How much loan did George borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8760 to clear it?
(5) Jennifer took a loan of $4500 at the rate of 10% simple interest per annum. If he paid an amount of $7200 to clear the loan, then find the time period of the loan.
(6) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 9% simple interest?
(7) Linda took a loan of $4700 at the rate of 6% simple interest per annum. If he paid an amount of $6956 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if Karen borrowed a sum of $3950 at 2% simple interest for 3 years.
(9) Calculate the amount due if Sarah borrowed a sum of $3850 at 5% simple interest for 4 years.
(10) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 9% simple interest.