Question:
Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 10% simple interest.
Correct Answer
$11200
Solution And Explanation
Solution
Given,
Principal (P) = $5600
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) = $5600 × 10% × 10
= $5600 ×10/100 × 10
= 5600 × 10 × 10/100
= 56000 × 10/100
= 560000/100
= $5600
Thus, Simple Interest = $5600
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 = $5600 + $5600
= $11200
Thus, Amount to be paid = $11200 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 = $5600
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 10 years
Thus, Amount (A)
= $5600 + ($5600 × 10% × 10)
= $5600 + ($5600 ×10/100 × 10)
= $5600 + (5600 × 10 × 10/100)
= $5600 + (56000 × 10/100)
= $5600 + (560000/100)
= $5600 + $5600 = $11200
Thus, Amount (A) to be paid = $11200 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 $5600, the simple interest in 1 year
= 10/100 × 5600
= 10 × 5600/100
= 56000/100 = $560
Thus, simple interest for 1 year = $560
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $560 × 10 = $5600
Thus, Simple Interest (SI) = $5600
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $5600
= $11200
Thus, Amount to be paid = $11200 Answer
Similar Questions
(1) Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $9324 to clear the loan, then find the time period of the loan.
(2) Charles took a loan of $5800 at the rate of 9% simple interest per annum. If he paid an amount of $11020 to clear the loan, then find the time period of the loan.
(3) How much loan did Melissa borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8085 to clear it?
(4) Calculate the amount due if Sarah borrowed a sum of $3850 at 8% simple interest for 4 years.
(5) Susan took a loan of $5300 at the rate of 9% simple interest per annum. If he paid an amount of $9116 to clear the loan, then find the time period of the loan.
(6) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 6% simple interest?
(7) Robert took a loan of $4200 at the rate of 9% simple interest per annum. If he paid an amount of $7224 to clear the loan, then find the time period of the loan.
(8) Donald took a loan of $7000 at the rate of 10% simple interest per annum. If he paid an amount of $13300 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due after 9 years if Robert borrowed a sum of $5100 at a rate of 6% simple interest.
(10) Find the amount to be paid if Charles borrowed a sum of $5900 at 3% simple interest for 7 years.