Question:
Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 7% simple interest.
Correct Answer
$8557.5
Solution And Explanation
Solution
Given,
Principal (P) = $5250
Rate of Simple Interest (SI) = 7%
Time (t) = 9 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $5250 × 7% × 9
= $5250 ×7/100 × 9
= 5250 × 7 × 9/100
= 36750 × 9/100
= 330750/100
= $3307.5
Thus, Simple Interest = $3307.5
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 = $5250 + $3307.5
= $8557.5
Thus, Amount to be paid = $8557.5 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 = $5250
Rate of Simple Interest (SI) or (R) = 7%
And, Time (t) = 9 years
Thus, Amount (A)
= $5250 + ($5250 × 7% × 9)
= $5250 + ($5250 ×7/100 × 9)
= $5250 + (5250 × 7 × 9/100)
= $5250 + (36750 × 9/100)
= $5250 + (330750/100)
= $5250 + $3307.5 = $8557.5
Thus, Amount (A) to be paid = $8557.5 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 7%
This, means, $7 per $100 per year
∵ For $100, the simple interest for 1 year = $7
∴ For $1, the simple interest for 1 year = 7/100
∴ For $5250, the simple interest in 1 year
= 7/100 × 5250
= 7 × 5250/100
= 36750/100 = $367.5
Thus, simple interest for 1 year = $367.5
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $367.5 × 9 = $3307.5
Thus, Simple Interest (SI) = $3307.5
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5250 + $3307.5
= $8557.5
Thus, Amount to be paid = $8557.5 Answer
Similar Questions
(1) How much loan did Brian borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7920 to clear it?
(2) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.
(3) How much loan did David borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6210 to clear it?
(4) Charles took a loan of $5800 at the rate of 10% simple interest per annum. If he paid an amount of $9280 to clear the loan, then find the time period of the loan.
(5) If Susan borrowed $3650 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(6) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 3% simple interest for 8 years.
(7) Calculate the amount due if William borrowed a sum of $3500 at 2% simple interest for 3 years.
(8) In how much time a principal of $3050 will amount to $3172 at a simple interest of 2% per annum?
(9) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 9% simple interest.
(10) Find the amount to be paid if Mary borrowed a sum of $5050 at 8% simple interest for 8 years.