Question:
Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 8% simple interest.
Correct Answer
$9630
Solution And Explanation
Solution
Given,
Principal (P) = $5350
Rate of Simple Interest (SI) = 8%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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 × 8% × 10
= $5350 ×8/100 × 10
= 5350 × 8 × 10/100
= 42800 × 10/100
= 428000/100
= $4280
Thus, Simple Interest = $4280
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 + $4280
= $9630
Thus, Amount to be paid = $9630 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) = 8%
And, Time (t) = 10 years
Thus, Amount (A)
= $5350 + ($5350 × 8% × 10)
= $5350 + ($5350 ×8/100 × 10)
= $5350 + (5350 × 8 × 10/100)
= $5350 + (42800 × 10/100)
= $5350 + (428000/100)
= $5350 + $4280 = $9630
Thus, Amount (A) to be paid = $9630 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 8%
This, means, $8 per $100 per year
∵ For $100, the simple interest for 1 year = $8
∴ For $1, the simple interest for 1 year = 8/100
∴ For $5350, the simple interest in 1 year
= 8/100 × 5350
= 8 × 5350/100
= 42800/100 = $428
Thus, simple interest for 1 year = $428
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $428 × 10 = $4280
Thus, Simple Interest (SI) = $4280
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5350 + $4280
= $9630
Thus, Amount to be paid = $9630 Answer
Similar Questions
(1) Find the amount to be paid if Christopher borrowed a sum of $6000 at 7% simple interest for 8 years.
(2) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 10% simple interest?
(3) Calculate the amount due if Robert borrowed a sum of $3100 at 7% simple interest for 4 years.
(4) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $9768 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 10% simple interest.
(6) Anthony took a loan of $6600 at the rate of 8% simple interest per annum. If he paid an amount of $10296 to clear the loan, then find the time period of the loan.
(7) If Ashley paid $5278 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(8) If Mark paid $5104 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(9) Calculate the amount due if Charles borrowed a sum of $3900 at 10% simple interest for 3 years.
(10) Linda took a loan of $4700 at the rate of 9% simple interest per annum. If he paid an amount of $8084 to clear the loan, then find the time period of the loan.