Question:
Find the amount to be paid if Linda borrowed a sum of $5350 at 3% simple interest for 7 years.
Correct Answer
$6473.5
Solution And Explanation
Solution
Given,
Principal (P) = $5350
Rate of Simple Interest (SI) = 3%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $5350 × 3% × 7
= $5350 ×3/100 × 7
= 5350 × 3 × 7/100
= 16050 × 7/100
= 112350/100
= $1123.5
Thus, Simple Interest = $1123.5
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 = $5350 + $1123.5
= $6473.5
Thus, Amount to be paid = $6473.5 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 = $5350
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 7 years
Thus, Amount (A)
= $5350 + ($5350 × 3% × 7)
= $5350 + ($5350 ×3/100 × 7)
= $5350 + (5350 × 3 × 7/100)
= $5350 + (16050 × 7/100)
= $5350 + (112350/100)
= $5350 + $1123.5 = $6473.5
Thus, Amount (A) to be paid = $6473.5 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $5350, the simple interest in 1 year
= 3/100 × 5350
= 3 × 5350/100
= 16050/100 = $160.5
Thus, simple interest for 1 year = $160.5
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $160.5 × 7 = $1123.5
Thus, Simple Interest (SI) = $1123.5
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5350 + $1123.5
= $6473.5
Thus, Amount to be paid = $6473.5 Answer
Similar Questions
(1) Find the amount to be paid if Sarah borrowed a sum of $5850 at 2% simple interest for 8 years.
(2) Calculate the amount due if Patricia borrowed a sum of $3150 at 6% simple interest for 3 years.
(3) If Kimberly paid $5022 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(4) If Susan paid $4088 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(5) Calculate the amount due after 9 years if David borrowed a sum of $5400 at a rate of 3% simple interest.
(6) Find the amount to be paid if William borrowed a sum of $5500 at 4% simple interest for 7 years.
(7) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 5% simple interest.
(8) Nancy took a loan of $6300 at the rate of 10% simple interest per annum. If he paid an amount of $11340 to clear the loan, then find the time period of the loan.
(9) Richard took a loan of $5200 at the rate of 10% simple interest per annum. If he paid an amount of $9880 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if Charles borrowed a sum of $3900 at 10% simple interest for 4 years.