Question:
What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 9% simple interest?
Correct Answer
$6160
Solution And Explanation
Solution
Given,
Principal (P) = $4000
Rate of Simple Interest (SI) = 9%
Time (t) = 6 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $4000 × 9% × 6
= $4000 ×9/100 × 6
= 4000 × 9 × 6/100
= 36000 × 6/100
= 216000/100
= $2160
Thus, Simple Interest = $2160
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 = $4000 + $2160
= $6160
Thus, Amount to be paid = $6160 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 = $4000
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 6 years
Thus, Amount (A)
= $4000 + ($4000 × 9% × 6)
= $4000 + ($4000 ×9/100 × 6)
= $4000 + (4000 × 9 × 6/100)
= $4000 + (36000 × 6/100)
= $4000 + (216000/100)
= $4000 + $2160 = $6160
Thus, Amount (A) to be paid = $6160 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $4000, the simple interest in 1 year
= 9/100 × 4000
= 9 × 4000/100
= 36000/100 = $360
Thus, simple interest for 1 year = $360
Therefore, simple interest for 6 years
= Simple interest for 1 year × 6
= $360 × 6 = $2160
Thus, Simple Interest (SI) = $2160
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $4000 + $2160
= $6160
Thus, Amount to be paid = $6160 Answer
Similar Questions
(1) Calculate the amount due if Thomas borrowed a sum of $3800 at 3% simple interest for 4 years.
(2) Elizabeth took a loan of $4900 at the rate of 8% simple interest per annum. If he paid an amount of $8428 to clear the loan, then find the time period of the loan.
(3) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 10% simple interest?
(4) Calculate the amount due if Robert borrowed a sum of $3100 at 6% simple interest for 3 years.
(5) How much loan did Charles borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6490 to clear it?
(6) Linda took a loan of $4700 at the rate of 7% simple interest per annum. If he paid an amount of $7332 to clear the loan, then find the time period of the loan.
(7) What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 9% simple interest?
(8) If Charles paid $4524 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(9) Richard took a loan of $5200 at the rate of 9% simple interest per annum. If he paid an amount of $9412 to clear the loan, then find the time period of the loan.
(10) Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $9288 to clear the loan, then find the time period of the loan.