Question:
Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 3% simple interest.
Correct Answer
$7215
Solution And Explanation
Solution
Given,
Principal (P) = $5550
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) = $5550 × 3% × 10
= $5550 ×3/100 × 10
= 5550 × 3 × 10/100
= 16650 × 10/100
= 166500/100
= $1665
Thus, Simple Interest = $1665
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 = $5550 + $1665
= $7215
Thus, Amount to be paid = $7215 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 = $5550
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 10 years
Thus, Amount (A)
= $5550 + ($5550 × 3% × 10)
= $5550 + ($5550 ×3/100 × 10)
= $5550 + (5550 × 3 × 10/100)
= $5550 + (16650 × 10/100)
= $5550 + (166500/100)
= $5550 + $1665 = $7215
Thus, Amount (A) to be paid = $7215 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 $5550, the simple interest in 1 year
= 3/100 × 5550
= 3 × 5550/100
= 16650/100 = $166.5
Thus, simple interest for 1 year = $166.5
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $166.5 × 10 = $1665
Thus, Simple Interest (SI) = $1665
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5550 + $1665
= $7215
Thus, Amount to be paid = $7215 Answer
Similar Questions
(1) Find the amount to be paid if Charles borrowed a sum of $5900 at 4% simple interest for 7 years.
(2) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 2% simple interest?
(3) Calculate the amount due if John borrowed a sum of $3200 at 10% simple interest for 4 years.
(4) Christopher had to pay $4480 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(5) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 4% simple interest for 7 years.
(6) If Susan borrowed $3650 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(7) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 4% simple interest.
(8) Christopher took a loan of $6000 at the rate of 8% simple interest per annum. If he paid an amount of $10800 to clear the loan, then find the time period of the loan.
(9) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $8772 to clear the loan, then find the time period of the loan.
(10) If David borrowed $3400 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.