Question:
Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.
Correct Answer
$9975
Solution And Explanation
Solution
Given,
Principal (P) = $5250
Rate of Simple Interest (SI) = 9%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $5250 × 9% × 10
= $5250 ×9/100 × 10
= 5250 × 9 × 10/100
= 47250 × 10/100
= 472500/100
= $4725
Thus, Simple Interest = $4725
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 = $5250 + $4725
= $9975
Thus, Amount to be paid = $9975 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 = $5250
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 10 years
Thus, Amount (A)
= $5250 + ($5250 × 9% × 10)
= $5250 + ($5250 ×9/100 × 10)
= $5250 + (5250 × 9 × 10/100)
= $5250 + (47250 × 10/100)
= $5250 + (472500/100)
= $5250 + $4725 = $9975
Thus, Amount (A) to be paid = $9975 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $5250, the simple interest in 1 year
= 9/100 × 5250
= 9 × 5250/100
= 47250/100 = $472.5
Thus, simple interest for 1 year = $472.5
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $472.5 × 10 = $4725
Thus, Simple Interest (SI) = $4725
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5250 + $4725
= $9975
Thus, Amount to be paid = $9975 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 5% simple interest.
(2) Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $8946 to clear the loan, then find the time period of the loan.
(3) What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 5% simple interest?
(4) Calculate the amount due if Jessica borrowed a sum of $3750 at 2% simple interest for 4 years.
(5) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 5% simple interest?
(6) If Sarah borrowed $3850 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(7) Linda had to pay $3651.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(8) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $12540 to clear the loan, then find the time period of the loan.
(9) How much loan did Lisa borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7260 to clear it?
(10) Richard took a loan of $5200 at the rate of 8% simple interest per annum. If he paid an amount of $7696 to clear the loan, then find the time period of the loan.