Question:
Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 8% simple interest.
Correct Answer
$9030
Solution And Explanation
Solution
Given,
Principal (P) = $5250
Rate of Simple Interest (SI) = 8%
Time (t) = 9 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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 × 8% × 9
= $5250 ×8/100 × 9
= 5250 × 8 × 9/100
= 42000 × 9/100
= 378000/100
= $3780
Thus, Simple Interest = $3780
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 + $3780
= $9030
Thus, Amount to be paid = $9030 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) = 8%
And, Time (t) = 9 years
Thus, Amount (A)
= $5250 + ($5250 × 8% × 9)
= $5250 + ($5250 ×8/100 × 9)
= $5250 + (5250 × 8 × 9/100)
= $5250 + (42000 × 9/100)
= $5250 + (378000/100)
= $5250 + $3780 = $9030
Thus, Amount (A) to be paid = $9030 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 8%
This, means, $8 per $100 per year
∵ For $100, the simple interest for 1 year = $8
∴ For $1, the simple interest for 1 year = 8/100
∴ For $5250, the simple interest in 1 year
= 8/100 × 5250
= 8 × 5250/100
= 42000/100 = $420
Thus, simple interest for 1 year = $420
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $420 × 9 = $3780
Thus, Simple Interest (SI) = $3780
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5250 + $3780
= $9030
Thus, Amount to be paid = $9030 Answer
Similar Questions
(1) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 10% simple interest?
(2) Robert took a loan of $4200 at the rate of 7% simple interest per annum. If he paid an amount of $6846 to clear the loan, then find the time period of the loan.
(3) If Jessica paid $4500 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(4) Find the amount to be paid if Barbara borrowed a sum of $5550 at 5% simple interest for 8 years.
(5) If Mary paid $3660 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(6) Calculate the amount due if Jessica borrowed a sum of $3750 at 3% simple interest for 3 years.
(7) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $8400 to clear the loan, then find the time period of the loan.
(8) What amount will be due after 2 years if Charles borrowed a sum of $3450 at a 5% simple interest?
(9) Nancy had to pay $4399 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(10) John took a loan of $4400 at the rate of 9% simple interest per annum. If he paid an amount of $8360 to clear the loan, then find the time period of the loan.