Question:
Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 4% simple interest.
Correct Answer
$7888
Solution And Explanation
Solution
Given,
Principal (P) = $5800
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) = $5800 × 4% × 9
= $5800 ×4/100 × 9
= 5800 × 4 × 9/100
= 23200 × 9/100
= 208800/100
= $2088
Thus, Simple Interest = $2088
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 = $5800 + $2088
= $7888
Thus, Amount to be paid = $7888 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 = $5800
Rate of Simple Interest (SI) or (R) = 4%
And, Time (t) = 9 years
Thus, Amount (A)
= $5800 + ($5800 × 4% × 9)
= $5800 + ($5800 ×4/100 × 9)
= $5800 + (5800 × 4 × 9/100)
= $5800 + (23200 × 9/100)
= $5800 + (208800/100)
= $5800 + $2088 = $7888
Thus, Amount (A) to be paid = $7888 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 $5800, the simple interest in 1 year
= 4/100 × 5800
= 4 × 5800/100
= 23200/100 = $232
Thus, simple interest for 1 year = $232
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $232 × 9 = $2088
Thus, Simple Interest (SI) = $2088
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $2088
= $7888
Thus, Amount to be paid = $7888 Answer
Similar Questions
(1) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $11868 to clear the loan, then find the time period of the loan.
(2) In how much time a principal of $3150 will amount to $3402 at a simple interest of 2% per annum?
(3) Find the amount to be paid if James borrowed a sum of $5000 at 9% simple interest for 8 years.
(4) James had to pay $3270 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(5) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $10764 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due if Linda borrowed a sum of $3350 at 9% simple interest for 3 years.
(7) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $10320 to clear the loan, then find the time period of the loan.
(8) Richard had to pay $3816 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(9) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 10% simple interest.
(10) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 8% simple interest for 7 years.