Question:
Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 6% simple interest.
Correct Answer
$7700
Solution And Explanation
Solution
Given,
Principal (P) = $5000
Rate of Simple Interest (SI) = 6%
Time (t) = 9 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $5000 × 6% × 9
= $5000 ×6/100 × 9
= 5000 × 6 × 9/100
= 30000 × 9/100
= 270000/100
= $2700
Thus, Simple Interest = $2700
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 = $5000 + $2700
= $7700
Thus, Amount to be paid = $7700 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 = $5000
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 9 years
Thus, Amount (A)
= $5000 + ($5000 × 6% × 9)
= $5000 + ($5000 ×6/100 × 9)
= $5000 + (5000 × 6 × 9/100)
= $5000 + (30000 × 9/100)
= $5000 + (270000/100)
= $5000 + $2700 = $7700
Thus, Amount (A) to be paid = $7700 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $5000, the simple interest in 1 year
= 6/100 × 5000
= 6 × 5000/100
= 30000/100 = $300
Thus, simple interest for 1 year = $300
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $300 × 9 = $2700
Thus, Simple Interest (SI) = $2700
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5000 + $2700
= $7700
Thus, Amount to be paid = $7700 Answer
Similar Questions
(1) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 8% simple interest for 8 years.
(2) How much loan did Deborah borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8195 to clear it?
(3) Find the amount to be paid if Joseph borrowed a sum of $5700 at 7% simple interest for 7 years.
(4) Richard took a loan of $5200 at the rate of 9% simple interest per annum. If he paid an amount of $9412 to clear the loan, then find the time period of the loan.
(5) Find the amount to be paid if David borrowed a sum of $5400 at 3% simple interest for 7 years.
(6) Find the amount to be paid if John borrowed a sum of $5200 at 10% simple interest for 7 years.
(7) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 2% simple interest?
(8) How much loan did Carol borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8812.5 to clear it?
(9) Calculate the amount due after 9 years if Charles borrowed a sum of $5900 at a rate of 5% simple interest.
(10) Calculate the amount due if Barbara borrowed a sum of $3550 at 9% simple interest for 3 years.