Question:
Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 8% simple interest.
Correct Answer
$9632
Solution And Explanation
Solution
Given,
Principal (P) = $5600
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) = $5600 × 8% × 9
= $5600 ×8/100 × 9
= 5600 × 8 × 9/100
= 44800 × 9/100
= 403200/100
= $4032
Thus, Simple Interest = $4032
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 = $5600 + $4032
= $9632
Thus, Amount to be paid = $9632 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 = $5600
Rate of Simple Interest (SI) or (R) = 8%
And, Time (t) = 9 years
Thus, Amount (A)
= $5600 + ($5600 × 8% × 9)
= $5600 + ($5600 ×8/100 × 9)
= $5600 + (5600 × 8 × 9/100)
= $5600 + (44800 × 9/100)
= $5600 + (403200/100)
= $5600 + $4032 = $9632
Thus, Amount (A) to be paid = $9632 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 $5600, the simple interest in 1 year
= 8/100 × 5600
= 8 × 5600/100
= 44800/100 = $448
Thus, simple interest for 1 year = $448
Therefore, simple interest for 9 years
= Simple interest for 1 year × 9
= $448 × 9 = $4032
Thus, Simple Interest (SI) = $4032
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $4032
= $9632
Thus, Amount to be paid = $9632 Answer
Similar Questions
(1) Calculate the amount due if James borrowed a sum of $3000 at 9% simple interest for 3 years.
(2) If James paid $3240 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(3) If Barbara paid $3976 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(4) In how much time a principal of $3000 will amount to $3600 at a simple interest of 4% per annum?
(5) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $7897 to clear the loan, then find the time period of the loan.
(6) Matthew took a loan of $6400 at the rate of 8% simple interest per annum. If he paid an amount of $9984 to clear the loan, then find the time period of the loan.
(7) Find the amount to be paid if Richard borrowed a sum of $5600 at 5% simple interest for 7 years.
(8) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 4% simple interest.
(9) What amount does David have to pay after 5 years if he takes a loan of $3400 at 5% simple interest?
(10) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 7% simple interest.