Question:
Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 6% simple interest.
Correct Answer
$9280
Solution And Explanation
Solution
Given,
Principal (P) = $5800
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) = $5800 × 6% × 10
= $5800 ×6/100 × 10
= 5800 × 6 × 10/100
= 34800 × 10/100
= 348000/100
= $3480
Thus, Simple Interest = $3480
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 + $3480
= $9280
Thus, Amount to be paid = $9280 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) = 6%
And, Time (t) = 10 years
Thus, Amount (A)
= $5800 + ($5800 × 6% × 10)
= $5800 + ($5800 ×6/100 × 10)
= $5800 + (5800 × 6 × 10/100)
= $5800 + (34800 × 10/100)
= $5800 + (348000/100)
= $5800 + $3480 = $9280
Thus, Amount (A) to be paid = $9280 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 $5800, the simple interest in 1 year
= 6/100 × 5800
= 6 × 5800/100
= 34800/100 = $348
Thus, simple interest for 1 year = $348
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $348 × 10 = $3480
Thus, Simple Interest (SI) = $3480
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $3480
= $9280
Thus, Amount to be paid = $9280 Answer
Similar Questions
(1) In how much time a principal of $3050 will amount to $3812.5 at a simple interest of 5% per annum?
(2) How much loan did Sarah borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6435 to clear it?
(3) Calculate the amount due if David borrowed a sum of $3400 at 7% simple interest for 4 years.
(4) 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?
(5) How much loan did Nancy borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7380 to clear it?
(6) Calculate the amount due if Charles borrowed a sum of $3900 at 2% simple interest for 4 years.
(7) How much loan did Ronald borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8250 to clear it?
(8) How much loan did Michelle borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7645 to clear it?
(9) David took a loan of $4800 at the rate of 8% simple interest per annum. If he paid an amount of $7104 to clear the loan, then find the time period of the loan.
(10) Find the amount to be paid if Robert borrowed a sum of $5100 at 5% simple interest for 7 years.