Question:
Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 4% simple interest.
Correct Answer
$8120
Solution And Explanation
Solution
Given,
Principal (P) = $5800
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) = $5800 × 4% × 10
= $5800 ×4/100 × 10
= 5800 × 4 × 10/100
= 23200 × 10/100
= 232000/100
= $2320
Thus, Simple Interest = $2320
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 = $5800 + $2320
= $8120
Thus, Amount to be paid = $8120 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 = $5800
Rate of Simple Interest (SI) or (R) = 4%
And, Time (t) = 10 years
Thus, Amount (A)
= $5800 + ($5800 × 4% × 10)
= $5800 + ($5800 ×4/100 × 10)
= $5800 + (5800 × 4 × 10/100)
= $5800 + (23200 × 10/100)
= $5800 + (232000/100)
= $5800 + $2320 = $8120
Thus, Amount (A) to be paid = $8120 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 $5800, the simple interest in 1 year
= 4/100 × 5800
= 4 × 5800/100
= 23200/100 = $232
Thus, simple interest for 1 year = $232
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $232 × 10 = $2320
Thus, Simple Interest (SI) = $2320
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $2320
= $8120
Thus, Amount to be paid = $8120 Answer
Similar Questions
(1) Find the amount to be paid if Charles borrowed a sum of $5900 at 6% simple interest for 8 years.
(2) Karen had to pay $4305.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(3) Robert took a loan of $4200 at the rate of 9% simple interest per annum. If he paid an amount of $6468 to clear the loan, then find the time period of the loan.
(4) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 6% simple interest?
(5) Joseph took a loan of $5400 at the rate of 8% simple interest per annum. If he paid an amount of $7992 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if Barbara borrowed a sum of $5550 at 4% simple interest for 7 years.
(7) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 2% simple interest.
(8) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 10% simple interest?
(9) If Ashley paid $5278 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(10) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $10164 to clear the loan, then find the time period of the loan.