Question:
Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 10% simple interest.
Correct Answer
$11600
Solution And Explanation
Solution
Given,
Principal (P) = $5800
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) = $5800 × 10% × 10
= $5800 ×10/100 × 10
= 5800 × 10 × 10/100
= 58000 × 10/100
= 580000/100
= $5800
Thus, Simple Interest = $5800
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 = $5800 + $5800
= $11600
Thus, Amount to be paid = $11600 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 = $5800
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 10 years
Thus, Amount (A)
= $5800 + ($5800 × 10% × 10)
= $5800 + ($5800 ×10/100 × 10)
= $5800 + (5800 × 10 × 10/100)
= $5800 + (58000 × 10/100)
= $5800 + (580000/100)
= $5800 + $5800 = $11600
Thus, Amount (A) to be paid = $11600 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 $5800, the simple interest in 1 year
= 10/100 × 5800
= 10 × 5800/100
= 58000/100 = $580
Thus, simple interest for 1 year = $580
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $580 × 10 = $5800
Thus, Simple Interest (SI) = $5800
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $5800
= $11600
Thus, Amount to be paid = $11600 Answer
Similar Questions
(1) Michael took a loan of $4600 at the rate of 10% simple interest per annum. If he paid an amount of $9200 to clear the loan, then find the time period of the loan.
(2) Mary had to pay $3416 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(3) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 5% simple interest.
(4) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 9% simple interest.
(5) Calculate the amount due if Charles borrowed a sum of $3900 at 8% simple interest for 4 years.
(6) Find the amount to be paid if Jessica borrowed a sum of $5750 at 2% simple interest for 7 years.
(7) Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $10010 to clear the loan, then find the time period of the loan.
(8) James took a loan of $4000 at the rate of 6% simple interest per annum. If he paid an amount of $5920 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 8% simple interest for 4 years.
(10) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 10% simple interest.