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) If Joshua paid $5292 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(2) If Margaret paid $5220 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(3) Matthew took a loan of $6400 at the rate of 7% simple interest per annum. If he paid an amount of $9536 to clear the loan, then find the time period of the loan.
(4) How much loan did George borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9125 to clear it?
(5) How much loan did Barbara borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6660 to clear it?
(6) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 6% simple interest.
(7) How much loan did Sharon borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8525 to clear it?
(8) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $8976 to clear the loan, then find the time period of the loan.
(9) Michael took a loan of $4600 at the rate of 8% simple interest per annum. If he paid an amount of $7176 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 8% simple interest.