Question:
( 1 of 10 ) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 4% simple interest.
(A) 4 47/50 Or, 247/50
(B) 8 47/50 Or, 447/50
(C) 4 141/50 Or, 341/50
(D) 4 94/50 Or, 294/50
You selected
$5950
Correct Answer
$8330
Solution And Explanation
Solution
Given,
Principal (P) = $5950
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) = $5950 × 4% × 10
= $5950 ×4/100 × 10
= 5950 × 4 × 10/100
= 23800 × 10/100
= 238000/100
= $2380
Thus, Simple Interest = $2380
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 = $5950 + $2380
= $8330
Thus, Amount to be paid = $8330 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 = $5950
Rate of Simple Interest (SI) or (R) = 4%
And, Time (t) = 10 years
Thus, Amount (A)
= $5950 + ($5950 × 4% × 10)
= $5950 + ($5950 ×4/100 × 10)
= $5950 + (5950 × 4 × 10/100)
= $5950 + (23800 × 10/100)
= $5950 + (238000/100)
= $5950 + $2380 = $8330
Thus, Amount (A) to be paid = $8330 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 $5950, the simple interest in 1 year
= 4/100 × 5950
= 4 × 5950/100
= 23800/100 = $238
Thus, simple interest for 1 year = $238
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $238 × 10 = $2380
Thus, Simple Interest (SI) = $2380
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5950 + $2380
= $8330
Thus, Amount to be paid = $8330 Answer
Similar Questions
(1) Find the amount to be paid if Richard borrowed a sum of $5600 at 8% simple interest for 7 years.
(2) Linda took a loan of $4700 at the rate of 7% simple interest per annum. If he paid an amount of $7661 to clear the loan, then find the time period of the loan.
(3) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $8288 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due if Susan borrowed a sum of $3650 at 5% simple interest for 4 years.
(5) Find the amount to be paid if Robert borrowed a sum of $5100 at 2% simple interest for 8 years.
(6) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 5% simple interest.
(7) Find the amount to be paid if Karen borrowed a sum of $5950 at 4% simple interest for 7 years.
(8) If Jessica paid $4200 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(9) How much loan did Amanda borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8580 to clear it?
(10) Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $11730 to clear the loan, then find the time period of the loan.