Question:
Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 3% simple interest.
Correct Answer
$7280
Solution And Explanation
Solution
Given,
Principal (P) = $5600
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) = $5600 × 3% × 10
= $5600 ×3/100 × 10
= 5600 × 3 × 10/100
= 16800 × 10/100
= 168000/100
= $1680
Thus, Simple Interest = $1680
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 + $1680
= $7280
Thus, Amount to be paid = $7280 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) = 3%
And, Time (t) = 10 years
Thus, Amount (A)
= $5600 + ($5600 × 3% × 10)
= $5600 + ($5600 ×3/100 × 10)
= $5600 + (5600 × 3 × 10/100)
= $5600 + (16800 × 10/100)
= $5600 + (168000/100)
= $5600 + $1680 = $7280
Thus, Amount (A) to be paid = $7280 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 $5600, the simple interest in 1 year
= 3/100 × 5600
= 3 × 5600/100
= 16800/100 = $168
Thus, simple interest for 1 year = $168
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $168 × 10 = $1680
Thus, Simple Interest (SI) = $1680
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $1680
= $7280
Thus, Amount to be paid = $7280 Answer
Similar Questions
(1) How much loan did Elizabeth borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6267.5 to clear it?
(2) If Nancy paid $4814 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(3) If Donna paid $5432 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(4) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $10070 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due if William borrowed a sum of $3500 at 7% simple interest for 4 years.
(6) How much loan did Mary borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5555 to clear it?
(7) What amount will be due after 2 years if Paul borrowed a sum of $3850 at a 7% simple interest?
(8) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 9% simple interest.
(9) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 7% simple interest?
(10) Robert took a loan of $4200 at the rate of 6% simple interest per annum. If he paid an amount of $6216 to clear the loan, then find the time period of the loan.