Question:
( 1 of 10 ) Find the amount to be paid if Richard borrowed a sum of $5600 at 2% simple interest for 7 years.
(A) 4 47/50 Or, 247/50
(B) 8 47/50 Or, 447/50
(C) 4 141/50 Or, 341/50
(D) 4 94/50 Or, 294/50
You selected
$5600
Correct Answer
$6384
Solution And Explanation
Solution
Given,
Principal (P) = $5600
Rate of Simple Interest (SI) = 2%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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 × 2% × 7
= $5600 ×2/100 × 7
= 5600 × 2 × 7/100
= 11200 × 7/100
= 78400/100
= $784
Thus, Simple Interest = $784
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 + $784
= $6384
Thus, Amount to be paid = $6384 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) = 2%
And, Time (t) = 7 years
Thus, Amount (A)
= $5600 + ($5600 × 2% × 7)
= $5600 + ($5600 ×2/100 × 7)
= $5600 + (5600 × 2 × 7/100)
= $5600 + (11200 × 7/100)
= $5600 + (78400/100)
= $5600 + $784 = $6384
Thus, Amount (A) to be paid = $6384 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 2%
This, means, $2 per $100 per year
∵ For $100, the simple interest for 1 year = $2
∴ For $1, the simple interest for 1 year = 2/100
∴ For $5600, the simple interest in 1 year
= 2/100 × 5600
= 2 × 5600/100
= 11200/100 = $112
Thus, simple interest for 1 year = $112
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $112 × 7 = $784
Thus, Simple Interest (SI) = $784
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $784
= $6384
Thus, Amount to be paid = $6384 Answer
Similar Questions
(1) Find the amount to be paid if William borrowed a sum of $5500 at 7% simple interest for 7 years.
(2) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 4% simple interest?
(3) How much loan did Dorothy borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8337.5 to clear it?
(4) Nancy had to pay $4772.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(5) What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 7% simple interest?
(6) Find the amount to be paid if Joseph borrowed a sum of $5700 at 7% simple interest for 7 years.
(7) Calculate the amount due if Barbara borrowed a sum of $3550 at 4% simple interest for 3 years.
(8) Calculate the amount due if Patricia borrowed a sum of $3150 at 3% simple interest for 3 years.
(9) What amount does James have to pay after 6 years if he takes a loan of $3000 at 2% simple interest?
(10) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 3% simple interest.