Question:
( 1 of 10 ) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 8% simple interest.
(A) 4 47/50 Or, 247/50
(B) 8 47/50 Or, 447/50
(C) 4 141/50 Or, 341/50
(D) 4 94/50 Or, 294/50
You selected
$5550
Correct Answer
$9990
Solution And Explanation
Solution
Given,
Principal (P) = $5550
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) = $5550 × 8% × 10
= $5550 ×8/100 × 10
= 5550 × 8 × 10/100
= 44400 × 10/100
= 444000/100
= $4440
Thus, Simple Interest = $4440
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 + $4440
= $9990
Thus, Amount to be paid = $9990 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) = 8%
And, Time (t) = 10 years
Thus, Amount (A)
= $5550 + ($5550 × 8% × 10)
= $5550 + ($5550 ×8/100 × 10)
= $5550 + (5550 × 8 × 10/100)
= $5550 + (44400 × 10/100)
= $5550 + (444000/100)
= $5550 + $4440 = $9990
Thus, Amount (A) to be paid = $9990 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 $5550, the simple interest in 1 year
= 8/100 × 5550
= 8 × 5550/100
= 44400/100 = $444
Thus, simple interest for 1 year = $444
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $444 × 10 = $4440
Thus, Simple Interest (SI) = $4440
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5550 + $4440
= $9990
Thus, Amount to be paid = $9990 Answer
Similar Questions
(1) How much loan did Carol borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7755 to clear it?
(2) Christopher took a loan of $6000 at the rate of 10% simple interest per annum. If he paid an amount of $9600 to clear the loan, then find the time period of the loan.
(3) If Christopher paid $4480 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(4) How much loan did Mary borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $5807.5 to clear it?
(5) What amount will be due after 2 years if David borrowed a sum of $3200 at a 9% simple interest?
(6) If Barbara borrowed $3550 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(7) Elizabeth had to pay $3760.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(8) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 5% simple interest.
(9) Charles took a loan of $5800 at the rate of 10% simple interest per annum. If he paid an amount of $10440 to clear the loan, then find the time period of the loan.
(10) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 3% simple interest?