Question

A man invested $10,500 for 7 years at 5 ½ % per annum simple interest.

(A) Determine the simple interest payed

(B) Calculate the amount of money he collected after the period of 7 years

Answer 1

Quick answer :

(A) = $4042.50

(B) = $14520.50

Solution with steps :

Solution (A) :

Money invested by a man = $10,500

No.of years for which he invested his money = 7

Rate of interest = 5.5%

We know that :

`\tt \: Simple \: interest = (Principal × Rate × Time)/(100)`

Principal = 10500

Rate = 5.5%

Time = 7 years

Simple interest the man payed :

`= \tt(10500 * 55 * 7)/(10 * 100)`

`= \tt (4042500)/(1000)`

`\color{plum}=\tt 4042.50`

Therefore, the simple interest payed by the man = $4042.50

Solution (B) :

Money invested by the man (principal) = $10,500

The simple interest he payed = $4042.50

We know that :

`\tt \: amount = principal + interest`

The amount the man collected after a period of 7 years :

`= \tt10500 + 4042.50`

`=\tt 14520.50`

Thus, amount = $14520.50

Therefore the amount he collected after a period of 7 years = $14520.50