Question:
( 1 of 10 ) Find the amount to be paid if Richard borrowed a sum of $5600 at 3% 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
$6776
Solution And Explanation
Solution
Given,
Principal (P) = $5600
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) = $5600 × 3% × 7
= $5600 ×3/100 × 7
= 5600 × 3 × 7/100
= 16800 × 7/100
= 117600/100
= $1176
Thus, Simple Interest = $1176
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 + $1176
= $6776
Thus, Amount to be paid = $6776 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) = 3%
And, Time (t) = 7 years
Thus, Amount (A)
= $5600 + ($5600 × 3% × 7)
= $5600 + ($5600 ×3/100 × 7)
= $5600 + (5600 × 3 × 7/100)
= $5600 + (16800 × 7/100)
= $5600 + (117600/100)
= $5600 + $1176 = $6776
Thus, Amount (A) to be paid = $6776 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 $5600, the simple interest in 1 year
= 3/100 × 5600
= 3 × 5600/100
= 16800/100 = $168
Thus, simple interest for 1 year = $168
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $168 × 7 = $1176
Thus, Simple Interest (SI) = $1176
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $1176
= $6776
Thus, Amount to be paid = $6776 Answer
Similar Questions
(1) Calculate the amount due if Christopher borrowed a sum of $4000 at 8% simple interest for 4 years.
(2) How much loan did Jessica borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6900 to clear it?
(3) How much loan did David borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6480 to clear it?
(4) If Christopher paid $4640 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(5) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 5% simple interest.
(6) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 5% simple interest?
(7) Find the amount to be paid if Patricia borrowed a sum of $5150 at 9% simple interest for 7 years.
(8) Calculate the amount due if Sarah borrowed a sum of $3850 at 2% simple interest for 4 years.
(9) Sarah took a loan of $5700 at the rate of 10% simple interest per annum. If he paid an amount of $10260 to clear the loan, then find the time period of the loan.
(10) Find the amount to be paid if James borrowed a sum of $5000 at 8% simple interest for 7 years.