Question:
Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 5% simple interest.
Correct Answer
$8025
Solution And Explanation
Solution
Given,
Principal (P) = $5350
Rate of Simple Interest (SI) = 5%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $5350 × 5% × 10
= $5350 ×5/100 × 10
= 5350 × 5 × 10/100
= 26750 × 10/100
= 267500/100
= $2675
Thus, Simple Interest = $2675
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 = $5350 + $2675
= $8025
Thus, Amount to be paid = $8025 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 = $5350
Rate of Simple Interest (SI) or (R) = 5%
And, Time (t) = 10 years
Thus, Amount (A)
= $5350 + ($5350 × 5% × 10)
= $5350 + ($5350 ×5/100 × 10)
= $5350 + (5350 × 5 × 10/100)
= $5350 + (26750 × 10/100)
= $5350 + (267500/100)
= $5350 + $2675 = $8025
Thus, Amount (A) to be paid = $8025 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 5%
This, means, $5 per $100 per year
∵ For $100, the simple interest for 1 year = $5
∴ For $1, the simple interest for 1 year = 5/100
∴ For $5350, the simple interest in 1 year
= 5/100 × 5350
= 5 × 5350/100
= 26750/100 = $267.5
Thus, simple interest for 1 year = $267.5
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $267.5 × 10 = $2675
Thus, Simple Interest (SI) = $2675
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5350 + $2675
= $8025
Thus, Amount to be paid = $8025 Answer
Similar Questions
(1) Find the amount to be paid if Thomas borrowed a sum of $5800 at 4% simple interest for 7 years.
(2) Steven had to pay $4876 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(3) Find the amount to be paid if Joseph borrowed a sum of $5700 at 3% simple interest for 8 years.
(4) Calculate the amount due if Thomas borrowed a sum of $3800 at 2% simple interest for 3 years.
(5) If Thomas paid $4256 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(6) How much loan did Anthony borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7875 to clear it?
(7) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 7% simple interest.
(8) Calculate the amount due if David borrowed a sum of $3400 at 4% simple interest for 3 years.
(9) What amount does James have to pay after 5 years if he takes a loan of $3000 at 3% simple interest?
(10) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 4% simple interest?