Question:
Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 5% simple interest.
Correct Answer
$7902.5
Solution And Explanation
Solution
Given,
Principal (P) = $5450
Rate of Simple Interest (SI) = 5%
Time (t) = 9 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $5450 × 5% × 9
= $5450 ×5/100 × 9
= 5450 × 5 × 9/100
= 27250 × 9/100
= 245250/100
= $2452.5
Thus, Simple Interest = $2452.5
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 = $5450 + $2452.5
= $7902.5
Thus, Amount to be paid = $7902.5 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 = $5450
Rate of Simple Interest (SI) or (R) = 5%
And, Time (t) = 9 years
Thus, Amount (A)
= $5450 + ($5450 × 5% × 9)
= $5450 + ($5450 ×5/100 × 9)
= $5450 + (5450 × 5 × 9/100)
= $5450 + (27250 × 9/100)
= $5450 + (245250/100)
= $5450 + $2452.5 = $7902.5
Thus, Amount (A) to be paid = $7902.5 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 5%
This, means, $5 per $100 per year
∵ For $100, the simple interest for 1 year = $5
∴ For $1, the simple interest for 1 year = 5/100
∴ For $5450, the simple interest in 1 year
= 5/100 × 5450
= 5 × 5450/100
= 27250/100 = $272.5
Thus, simple interest for 1 year = $272.5
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $272.5 × 9 = $2452.5
Thus, Simple Interest (SI) = $2452.5
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5450 + $2452.5
= $7902.5
Thus, Amount to be paid = $7902.5 Answer
Similar Questions
(1) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 7% simple interest?
(2) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $9180 to clear the loan, then find the time period of the loan.
(3) Calculate the amount due if Mary borrowed a sum of $3050 at 7% simple interest for 4 years.
(4) If Kimberly paid $5394 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(5) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 5% simple interest for 8 years.
(6) How much loan did Daniel borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7015 to clear it?
(7) Find the amount to be paid if Karen borrowed a sum of $5950 at 8% simple interest for 8 years.
(8) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 5% simple interest?
(9) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 5% simple interest for 7 years.
(10) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $7952 to clear the loan, then find the time period of the loan.