Question:
Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 4% simple interest.
Correct Answer
$7616
Solution And Explanation
Solution
Given,
Principal (P) = $5600
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) = $5600 × 4% × 9
= $5600 ×4/100 × 9
= 5600 × 4 × 9/100
= 22400 × 9/100
= 201600/100
= $2016
Thus, Simple Interest = $2016
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 + $2016
= $7616
Thus, Amount to be paid = $7616 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) = 4%
And, Time (t) = 9 years
Thus, Amount (A)
= $5600 + ($5600 × 4% × 9)
= $5600 + ($5600 ×4/100 × 9)
= $5600 + (5600 × 4 × 9/100)
= $5600 + (22400 × 9/100)
= $5600 + (201600/100)
= $5600 + $2016 = $7616
Thus, Amount (A) to be paid = $7616 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 $5600, the simple interest in 1 year
= 4/100 × 5600
= 4 × 5600/100
= 22400/100 = $224
Thus, simple interest for 1 year = $224
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $224 × 9 = $2016
Thus, Simple Interest (SI) = $2016
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $2016
= $7616
Thus, Amount to be paid = $7616 Answer
Similar Questions
(1) Find the amount to be paid if Richard borrowed a sum of $5600 at 5% simple interest for 7 years.
(2) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 4% simple interest for 7 years.
(3) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 2% simple interest.
(4) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 3% simple interest?
(5) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $8688 to clear the loan, then find the time period of the loan.
(6) How much loan did Anthony borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7560 to clear it?
(7) How much loan did Laura borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9420 to clear it?
(8) James took a loan of $4000 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.
(9) In how much time a principal of $3100 will amount to $3565 at a simple interest of 3% per annum?
(10) How much loan did Sarah borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6435 to clear it?