Question:
Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 3% simple interest.
Correct Answer
$7670
Solution And Explanation
Solution
Given,
Principal (P) = $5900
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) = $5900 × 3% × 10
= $5900 ×3/100 × 10
= 5900 × 3 × 10/100
= 17700 × 10/100
= 177000/100
= $1770
Thus, Simple Interest = $1770
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 = $5900 + $1770
= $7670
Thus, Amount to be paid = $7670 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 = $5900
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 10 years
Thus, Amount (A)
= $5900 + ($5900 × 3% × 10)
= $5900 + ($5900 ×3/100 × 10)
= $5900 + (5900 × 3 × 10/100)
= $5900 + (17700 × 10/100)
= $5900 + (177000/100)
= $5900 + $1770 = $7670
Thus, Amount (A) to be paid = $7670 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 $5900, the simple interest in 1 year
= 3/100 × 5900
= 3 × 5900/100
= 17700/100 = $177
Thus, simple interest for 1 year = $177
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $177 × 10 = $1770
Thus, Simple Interest (SI) = $1770
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5900 + $1770
= $7670
Thus, Amount to be paid = $7670 Answer
Similar Questions
(1) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 8% simple interest?
(2) Jessica had to pay $3975 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(3) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 3% simple interest.
(4) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 3% simple interest?
(5) Calculate the amount due if Michael borrowed a sum of $3300 at 4% simple interest for 3 years.
(6) What amount will be due after 2 years if Robert borrowed a sum of $3050 at a 8% simple interest?
(7) What amount will be due after 2 years if Charles borrowed a sum of $3450 at a 4% simple interest?
(8) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 2% simple interest?
(9) If Linda borrowed $3350 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(10) If Daniel paid $4428 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.