Question:
Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 2% simple interest.
Correct Answer
$6900
Solution And Explanation
Solution
Given,
Principal (P) = $5750
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) = $5750 × 2% × 10
= $5750 ×2/100 × 10
= 5750 × 2 × 10/100
= 11500 × 10/100
= 115000/100
= $1150
Thus, Simple Interest = $1150
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 = $5750 + $1150
= $6900
Thus, Amount to be paid = $6900 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 = $5750
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 10 years
Thus, Amount (A)
= $5750 + ($5750 × 2% × 10)
= $5750 + ($5750 ×2/100 × 10)
= $5750 + (5750 × 2 × 10/100)
= $5750 + (11500 × 10/100)
= $5750 + (115000/100)
= $5750 + $1150 = $6900
Thus, Amount (A) to be paid = $6900 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 $5750, the simple interest in 1 year
= 2/100 × 5750
= 2 × 5750/100
= 11500/100 = $115
Thus, simple interest for 1 year = $115
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $115 × 10 = $1150
Thus, Simple Interest (SI) = $1150
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5750 + $1150
= $6900
Thus, Amount to be paid = $6900 Answer
Similar Questions
(1) Calculate the amount due if Jennifer borrowed a sum of $3250 at 5% simple interest for 3 years.
(2) Find the amount to be paid if Joseph borrowed a sum of $5700 at 6% simple interest for 8 years.
(3) Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 9% simple interest.
(4) Calculate the amount due if Thomas borrowed a sum of $3800 at 4% simple interest for 3 years.
(5) Lisa took a loan of $6100 at the rate of 7% simple interest per annum. If he paid an amount of $8662 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if Mary borrowed a sum of $5050 at 9% simple interest for 8 years.
(7) Elizabeth took a loan of $4900 at the rate of 6% simple interest per annum. If he paid an amount of $7840 to clear the loan, then find the time period of the loan.
(8) Find the amount to be paid if Christopher borrowed a sum of $6000 at 10% simple interest for 8 years.
(9) How much loan did Richard borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6440 to clear it?
(10) Find the amount to be paid if John borrowed a sum of $5200 at 6% simple interest for 7 years.