Question:
Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 10% simple interest.
Correct Answer
$11900
Solution And Explanation
Solution
Given,
Principal (P) = $5950
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) = $5950 × 10% × 10
= $5950 ×10/100 × 10
= 5950 × 10 × 10/100
= 59500 × 10/100
= 595000/100
= $5950
Thus, Simple Interest = $5950
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 = $5950 + $5950
= $11900
Thus, Amount to be paid = $11900 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 = $5950
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 10 years
Thus, Amount (A)
= $5950 + ($5950 × 10% × 10)
= $5950 + ($5950 ×10/100 × 10)
= $5950 + (5950 × 10 × 10/100)
= $5950 + (59500 × 10/100)
= $5950 + (595000/100)
= $5950 + $5950 = $11900
Thus, Amount (A) to be paid = $11900 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 $5950, the simple interest in 1 year
= 10/100 × 5950
= 10 × 5950/100
= 59500/100 = $595
Thus, simple interest for 1 year = $595
Therefore, simple interest for 10 years
= Simple interest for 1 year × 10
= $595 × 10 = $5950
Thus, Simple Interest (SI) = $5950
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5950 + $5950
= $11900
Thus, Amount to be paid = $11900 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 8% simple interest.
(2) Matthew took a loan of $6400 at the rate of 10% simple interest per annum. If he paid an amount of $11520 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Karen borrowed a sum of $5950 at 6% simple interest for 7 years.
(4) How much loan did Daniel borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6710 to clear it?
(5) How much loan did Robert borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $5865 to clear it?
(6) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 4% simple interest?
(7) Find the amount to be paid if Barbara borrowed a sum of $5550 at 3% simple interest for 8 years.
(8) Kenneth had to pay $5750 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(9) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 8% simple interest.
(10) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 7% simple interest?