Question:
Find the amount to be paid if Susan borrowed a sum of $5650 at 2% simple interest for 7 years.
Correct Answer
$6441
Solution And Explanation
Solution
Given,
Principal (P) = $5650
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) = $5650 × 2% × 7
= $5650 ×2/100 × 7
= 5650 × 2 × 7/100
= 11300 × 7/100
= 79100/100
= $791
Thus, Simple Interest = $791
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 = $5650 + $791
= $6441
Thus, Amount to be paid = $6441 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 = $5650
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 7 years
Thus, Amount (A)
= $5650 + ($5650 × 2% × 7)
= $5650 + ($5650 ×2/100 × 7)
= $5650 + (5650 × 2 × 7/100)
= $5650 + (11300 × 7/100)
= $5650 + (79100/100)
= $5650 + $791 = $6441
Thus, Amount (A) to be paid = $6441 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 $5650, the simple interest in 1 year
= 2/100 × 5650
= 2 × 5650/100
= 11300/100 = $113
Thus, simple interest for 1 year = $113
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $113 × 7 = $791
Thus, Simple Interest (SI) = $791
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5650 + $791
= $6441
Thus, Amount to be paid = $6441 Answer
Similar Questions
(1) What amount does Sarah have to pay after 6 years if he takes a loan of $3850 at 9% simple interest?
(2) In how much time a principal of $3150 will amount to $3780 at a simple interest of 4% per annum?
(3) Jennifer took a loan of $4500 at the rate of 6% simple interest per annum. If he paid an amount of $6390 to clear the loan, then find the time period of the loan.
(4) Mark had to pay $4664 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(5) Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 7% simple interest.
(6) Calculate the amount due if Charles borrowed a sum of $3900 at 6% simple interest for 3 years.
(7) Richard took a loan of $5200 at the rate of 6% simple interest per annum. If he paid an amount of $8008 to clear the loan, then find the time period of the loan.
(8) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $11222 to clear the loan, then find the time period of the loan.
(9) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 10% simple interest?
(10) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 10% simple interest?