Question:
Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 6% simple interest.
Correct Answer
$9120
Solution And Explanation
Solution
Given,
Principal (P) = $5700
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) = $5700 × 6% × 10
= $5700 ×6/100 × 10
= 5700 × 6 × 10/100
= 34200 × 10/100
= 342000/100
= $3420
Thus, Simple Interest = $3420
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 = $5700 + $3420
= $9120
Thus, Amount to be paid = $9120 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 = $5700
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 10 years
Thus, Amount (A)
= $5700 + ($5700 × 6% × 10)
= $5700 + ($5700 ×6/100 × 10)
= $5700 + (5700 × 6 × 10/100)
= $5700 + (34200 × 10/100)
= $5700 + (342000/100)
= $5700 + $3420 = $9120
Thus, Amount (A) to be paid = $9120 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 $5700, the simple interest in 1 year
= 6/100 × 5700
= 6 × 5700/100
= 34200/100 = $342
Thus, simple interest for 1 year = $342
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $342 × 10 = $3420
Thus, Simple Interest (SI) = $3420
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5700 + $3420
= $9120
Thus, Amount to be paid = $9120 Answer
Similar Questions
(1) William had to pay $3815 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(2) Find the amount to be paid if Michael borrowed a sum of $5300 at 9% simple interest for 8 years.
(3) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 9% simple interest?
(4) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $6240 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 2% simple interest.
(6) Find the amount to be paid if Barbara borrowed a sum of $5550 at 7% simple interest for 8 years.
(7) What amount will be due after 2 years if Joshua borrowed a sum of $3950 at a 8% simple interest?
(8) Calculate the amount due if Mary borrowed a sum of $3050 at 5% simple interest for 4 years.
(9) 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?
(10) In how much time a principal of $3200 will amount to $3488 at a simple interest of 3% per annum?