Question:
Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 9% simple interest.
Correct Answer
$10165
Solution And Explanation
Solution
Given,
Principal (P) = $5350
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) = $5350 × 9% × 10
= $5350 ×9/100 × 10
= 5350 × 9 × 10/100
= 48150 × 10/100
= 481500/100
= $4815
Thus, Simple Interest = $4815
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 + $4815
= $10165
Thus, Amount to be paid = $10165 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) = 9%
And, Time (t) = 10 years
Thus, Amount (A)
= $5350 + ($5350 × 9% × 10)
= $5350 + ($5350 ×9/100 × 10)
= $5350 + (5350 × 9 × 10/100)
= $5350 + (48150 × 10/100)
= $5350 + (481500/100)
= $5350 + $4815 = $10165
Thus, Amount (A) to be paid = $10165 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 $5350, the simple interest in 1 year
= 9/100 × 5350
= 9 × 5350/100
= 48150/100 = $481.5
Thus, simple interest for 1 year = $481.5
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $481.5 × 10 = $4815
Thus, Simple Interest (SI) = $4815
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5350 + $4815
= $10165
Thus, Amount to be paid = $10165 Answer
Similar Questions
(1) Sarah took a loan of $5700 at the rate of 10% simple interest per annum. If he paid an amount of $11400 to clear the loan, then find the time period of the loan.
(2) How much loan did Robert borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5610 to clear it?
(3) Mary took a loan of $4100 at the rate of 6% simple interest per annum. If he paid an amount of $6314 to clear the loan, then find the time period of the loan.
(4) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 2% simple interest?
(5) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $7172 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due if Michael borrowed a sum of $3300 at 2% simple interest for 4 years.
(7) Calculate the amount due if Jennifer borrowed a sum of $3250 at 8% simple interest for 4 years.
(8) Calculate the amount due if Jennifer borrowed a sum of $3250 at 8% simple interest for 3 years.
(9) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7647.5 to clear it?
(10) Calculate the amount due if David borrowed a sum of $3400 at 10% simple interest for 3 years.