Question:
Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 10% simple interest.
Correct Answer
$10500
Solution And Explanation
Solution
Given,
Principal (P) = $5250
Rate of Simple Interest (SI) = 10%
Time (t) = 10 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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 × 10% × 10
= $5250 ×10/100 × 10
= 5250 × 10 × 10/100
= 52500 × 10/100
= 525000/100
= $5250
Thus, Simple Interest = $5250
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 + $5250
= $10500
Thus, Amount to be paid = $10500 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) = 10%
And, Time (t) = 10 years
Thus, Amount (A)
= $5250 + ($5250 × 10% × 10)
= $5250 + ($5250 ×10/100 × 10)
= $5250 + (5250 × 10 × 10/100)
= $5250 + (52500 × 10/100)
= $5250 + (525000/100)
= $5250 + $5250 = $10500
Thus, Amount (A) to be paid = $10500 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 10%
This, means, $10 per $100 per year
∵ For $100, the simple interest for 1 year = $10
∴ For $1, the simple interest for 1 year = 10/100
∴ For $5250, the simple interest in 1 year
= 10/100 × 5250
= 10 × 5250/100
= 52500/100 = $525
Thus, simple interest for 1 year = $525
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $525 × 10 = $5250
Thus, Simple Interest (SI) = $5250
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5250 + $5250
= $10500
Thus, Amount to be paid = $10500 Answer
Similar Questions
(1) Daniel took a loan of $6200 at the rate of 7% simple interest per annum. If he paid an amount of $10540 to clear the loan, then find the time period of the loan.
(2) If Susan paid $4380 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(3) Thomas took a loan of $5600 at the rate of 7% simple interest per annum. If he paid an amount of $9128 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 3% simple interest.
(5) What amount will be due after 2 years if William borrowed a sum of $3250 at a 10% simple interest?
(6) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 10% simple interest.
(7) Margaret took a loan of $6700 at the rate of 10% simple interest per annum. If he paid an amount of $11390 to clear the loan, then find the time period of the loan.
(8) Find the amount to be paid if Joseph borrowed a sum of $5700 at 2% simple interest for 7 years.
(9) Karen took a loan of $5900 at the rate of 6% simple interest per annum. If he paid an amount of $8732 to clear the loan, then find the time period of the loan.
(10) If Sarah paid $4466 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.