Question:
Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 4% simple interest.
Correct Answer
$7910
Solution And Explanation
Solution
Given,
Principal (P) = $5650
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) = $5650 × 4% × 10
= $5650 ×4/100 × 10
= 5650 × 4 × 10/100
= 22600 × 10/100
= 226000/100
= $2260
Thus, Simple Interest = $2260
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 = $5650 + $2260
= $7910
Thus, Amount to be paid = $7910 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 = $5650
Rate of Simple Interest (SI) or (R) = 4%
And, Time (t) = 10 years
Thus, Amount (A)
= $5650 + ($5650 × 4% × 10)
= $5650 + ($5650 ×4/100 × 10)
= $5650 + (5650 × 4 × 10/100)
= $5650 + (22600 × 10/100)
= $5650 + (226000/100)
= $5650 + $2260 = $7910
Thus, Amount (A) to be paid = $7910 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 $5650, the simple interest in 1 year
= 4/100 × 5650
= 4 × 5650/100
= 22600/100 = $226
Thus, simple interest for 1 year = $226
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $226 × 10 = $2260
Thus, Simple Interest (SI) = $2260
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5650 + $2260
= $7910
Thus, Amount to be paid = $7910 Answer
Similar Questions
(1) Linda took a loan of $4700 at the rate of 8% simple interest per annum. If he paid an amount of $8460 to clear the loan, then find the time period of the loan.
(2) If Thomas paid $4408 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(3) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 5% simple interest?
(4) Calculate the amount due after 10 years if William borrowed a sum of $5500 at a rate of 5% simple interest.
(5) Calculate the amount due if Barbara borrowed a sum of $3550 at 4% simple interest for 4 years.
(6) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 3% simple interest.
(7) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7980 to clear it?
(8) Jennifer took a loan of $4500 at the rate of 9% simple interest per annum. If he paid an amount of $8550 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due if Joseph borrowed a sum of $3700 at 8% simple interest for 4 years.
(10) What amount does James have to pay after 5 years if he takes a loan of $3000 at 4% simple interest?