Question:
Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 2% simple interest.
Correct Answer
$6780
Solution And Explanation
Solution
Given,
Principal (P) = $5650
Rate of Simple Interest (SI) = 2%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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) = $5650 × 2% × 10
= $5650 ×2/100 × 10
= 5650 × 2 × 10/100
= 11300 × 10/100
= 113000/100
= $1130
Thus, Simple Interest = $1130
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 = $5650 + $1130
= $6780
Thus, Amount to be paid = $6780 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 = $5650
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 10 years
Thus, Amount (A)
= $5650 + ($5650 × 2% × 10)
= $5650 + ($5650 ×2/100 × 10)
= $5650 + (5650 × 2 × 10/100)
= $5650 + (11300 × 10/100)
= $5650 + (113000/100)
= $5650 + $1130 = $6780
Thus, Amount (A) to be paid = $6780 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 2%
This, means, $2 per $100 per year
∵ For $100, the simple interest for 1 year = $2
∴ For $1, the simple interest for 1 year = 2/100
∴ For $5650, the simple interest in 1 year
= 2/100 × 5650
= 2 × 5650/100
= 11300/100 = $113
Thus, simple interest for 1 year = $113
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $113 × 10 = $1130
Thus, Simple Interest (SI) = $1130
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5650 + $1130
= $6780
Thus, Amount to be paid = $6780 Answer
Similar Questions
(1) Karen took a loan of $5900 at the rate of 8% simple interest per annum. If he paid an amount of $10620 to clear the loan, then find the time period of the loan.
(2) Michael took a loan of $4600 at the rate of 7% simple interest per annum. If he paid an amount of $7820 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Linda borrowed a sum of $5350 at 9% simple interest for 8 years.
(4) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 7% simple interest?
(5) Emily had to pay $5320 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(6) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 10% simple interest?
(7) If Barbara borrowed $3550 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(8) John had to pay $3584 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(9) Calculate the amount due after 9 years if Robert borrowed a sum of $5100 at a rate of 8% simple interest.
(10) Calculate the amount due if William borrowed a sum of $3500 at 6% simple interest for 3 years.