Question:
Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 6% simple interest.
Correct Answer
$8880
Solution And Explanation
Solution
Given,
Principal (P) = $5550
Rate of Simple Interest (SI) = 6%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $5550 × 6% × 10
= $5550 ×6/100 × 10
= 5550 × 6 × 10/100
= 33300 × 10/100
= 333000/100
= $3330
Thus, Simple Interest = $3330
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 = $5550 + $3330
= $8880
Thus, Amount to be paid = $8880 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 = $5550
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 10 years
Thus, Amount (A)
= $5550 + ($5550 × 6% × 10)
= $5550 + ($5550 ×6/100 × 10)
= $5550 + (5550 × 6 × 10/100)
= $5550 + (33300 × 10/100)
= $5550 + (333000/100)
= $5550 + $3330 = $8880
Thus, Amount (A) to be paid = $8880 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $5550, the simple interest in 1 year
= 6/100 × 5550
= 6 × 5550/100
= 33300/100 = $333
Thus, simple interest for 1 year = $333
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $333 × 10 = $3330
Thus, Simple Interest (SI) = $3330
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5550 + $3330
= $8880
Thus, Amount to be paid = $8880 Answer
Similar Questions
(1) Margaret took a loan of $6700 at the rate of 9% simple interest per annum. If he paid an amount of $12127 to clear the loan, then find the time period of the loan.
(2) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $9916 to clear the loan, then find the time period of the loan.
(3) Patricia took a loan of $4300 at the rate of 8% simple interest per annum. If he paid an amount of $7396 to clear the loan, then find the time period of the loan.
(4) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $9983 to clear the loan, then find the time period of the loan.
(5) Find the amount to be paid if Christopher borrowed a sum of $6000 at 10% simple interest for 8 years.
(6) Robert had to pay $3379 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(7) What amount does John have to pay after 5 years if he takes a loan of $3200 at 8% simple interest?
(8) Calculate the amount due after 9 years if Sarah borrowed a sum of $5850 at a rate of 8% simple interest.
(9) Calculate the amount due if Richard borrowed a sum of $3600 at 2% simple interest for 3 years.
(10) Find the amount to be paid if John borrowed a sum of $5200 at 8% simple interest for 7 years.