Question:
Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 4% simple interest.
Correct Answer
$7140
Solution And Explanation
Solution
Given,
Principal (P) = $5100
Rate of Simple Interest (SI) = 4%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $5100 × 4% × 10
= $5100 ×4/100 × 10
= 5100 × 4 × 10/100
= 20400 × 10/100
= 204000/100
= $2040
Thus, Simple Interest = $2040
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 = $5100 + $2040
= $7140
Thus, Amount to be paid = $7140 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 = $5100
Rate of Simple Interest (SI) or (R) = 4%
And, Time (t) = 10 years
Thus, Amount (A)
= $5100 + ($5100 × 4% × 10)
= $5100 + ($5100 ×4/100 × 10)
= $5100 + (5100 × 4 × 10/100)
= $5100 + (20400 × 10/100)
= $5100 + (204000/100)
= $5100 + $2040 = $7140
Thus, Amount (A) to be paid = $7140 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 4%
This, means, $4 per $100 per year
∵ For $100, the simple interest for 1 year = $4
∴ For $1, the simple interest for 1 year = 4/100
∴ For $5100, the simple interest in 1 year
= 4/100 × 5100
= 4 × 5100/100
= 20400/100 = $204
Thus, simple interest for 1 year = $204
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $204 × 10 = $2040
Thus, Simple Interest (SI) = $2040
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5100 + $2040
= $7140
Thus, Amount to be paid = $7140 Answer
Similar Questions
(1) Calculate the amount due if Robert borrowed a sum of $3100 at 2% simple interest for 3 years.
(2) What amount does John have to pay after 6 years if he takes a loan of $3200 at 10% simple interest?
(3) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8312.5 to clear it?
(4) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 5% simple interest?
(5) Michael took a loan of $4600 at the rate of 6% simple interest per annum. If he paid an amount of $6808 to clear the loan, then find the time period of the loan.
(6) Margaret had to pay $4611 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(7) How much loan did Mark borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7040 to clear it?
(8) David had to pay $3604 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(9) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 9% simple interest?
(10) What amount will be due after 2 years if David borrowed a sum of $3200 at a 10% simple interest?