Question:
Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 7% simple interest.
Correct Answer
$9775
Solution And Explanation
Solution
Given,
Principal (P) = $5750
Rate of Simple Interest (SI) = 7%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $5750 × 7% × 10
= $5750 ×7/100 × 10
= 5750 × 7 × 10/100
= 40250 × 10/100
= 402500/100
= $4025
Thus, Simple Interest = $4025
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 = $5750 + $4025
= $9775
Thus, Amount to be paid = $9775 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 = $5750
Rate of Simple Interest (SI) or (R) = 7%
And, Time (t) = 10 years
Thus, Amount (A)
= $5750 + ($5750 × 7% × 10)
= $5750 + ($5750 ×7/100 × 10)
= $5750 + (5750 × 7 × 10/100)
= $5750 + (40250 × 10/100)
= $5750 + (402500/100)
= $5750 + $4025 = $9775
Thus, Amount (A) to be paid = $9775 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 7%
This, means, $7 per $100 per year
∵ For $100, the simple interest for 1 year = $7
∴ For $1, the simple interest for 1 year = 7/100
∴ For $5750, the simple interest in 1 year
= 7/100 × 5750
= 7 × 5750/100
= 40250/100 = $402.5
Thus, simple interest for 1 year = $402.5
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $402.5 × 10 = $4025
Thus, Simple Interest (SI) = $4025
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5750 + $4025
= $9775
Thus, Amount to be paid = $9775 Answer
Similar Questions
(1) Find the amount to be paid if Joseph borrowed a sum of $5700 at 3% simple interest for 8 years.
(2) How much loan did Kevin borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8875 to clear it?
(3) Calculate the amount due if Richard borrowed a sum of $3600 at 7% simple interest for 3 years.
(4) Find the amount to be paid if Linda borrowed a sum of $5350 at 10% simple interest for 8 years.
(5) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 7% simple interest.
(6) If Emily paid $5510 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(7) Find the amount to be paid if Jessica borrowed a sum of $5750 at 8% simple interest for 7 years.
(8) Calculate the amount due if Michael borrowed a sum of $3300 at 6% simple interest for 3 years.
(9) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 2% simple interest?
(10) Calculate the amount due after 9 years if Joseph borrowed a sum of $5700 at a rate of 5% simple interest.