Question:
Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 3% simple interest.
Correct Answer
$6760
Solution And Explanation
Solution
Given,
Principal (P) = $5200
Rate of Simple Interest (SI) = 3%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $5200 × 3% × 10
= $5200 ×3/100 × 10
= 5200 × 3 × 10/100
= 15600 × 10/100
= 156000/100
= $1560
Thus, Simple Interest = $1560
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 = $5200 + $1560
= $6760
Thus, Amount to be paid = $6760 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 = $5200
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 10 years
Thus, Amount (A)
= $5200 + ($5200 × 3% × 10)
= $5200 + ($5200 ×3/100 × 10)
= $5200 + (5200 × 3 × 10/100)
= $5200 + (15600 × 10/100)
= $5200 + (156000/100)
= $5200 + $1560 = $6760
Thus, Amount (A) to be paid = $6760 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $5200, the simple interest in 1 year
= 3/100 × 5200
= 3 × 5200/100
= 15600/100 = $156
Thus, simple interest for 1 year = $156
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $156 × 10 = $1560
Thus, Simple Interest (SI) = $1560
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5200 + $1560
= $6760
Thus, Amount to be paid = $6760 Answer
Similar Questions
(1) What amount will be due after 2 years if William borrowed a sum of $3250 at a 4% simple interest?
(2) Calculate the amount due if Christopher borrowed a sum of $4000 at 8% simple interest for 4 years.
(3) Calculate the amount due if Karen borrowed a sum of $3950 at 8% simple interest for 3 years.
(4) How much loan did Anthony borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7875 to clear it?
(5) Richard took a loan of $5200 at the rate of 9% simple interest per annum. If he paid an amount of $9412 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 2% simple interest.
(7) Calculate the amount due after 9 years if Robert borrowed a sum of $5100 at a rate of 3% simple interest.
(8) Joseph took a loan of $5400 at the rate of 10% simple interest per annum. If he paid an amount of $10260 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 9% simple interest for 4 years.
(10) If James paid $3600 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.