Question:
Find the amount to be paid if Charles borrowed a sum of $5900 at 3% simple interest for 7 years.
Correct Answer
$7139
Solution And Explanation
Solution
Given,
Principal (P) = $5900
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) = $5900 × 3% × 7
= $5900 ×3/100 × 7
= 5900 × 3 × 7/100
= 17700 × 7/100
= 123900/100
= $1239
Thus, Simple Interest = $1239
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 = $5900 + $1239
= $7139
Thus, Amount to be paid = $7139 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 = $5900
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 7 years
Thus, Amount (A)
= $5900 + ($5900 × 3% × 7)
= $5900 + ($5900 ×3/100 × 7)
= $5900 + (5900 × 3 × 7/100)
= $5900 + (17700 × 7/100)
= $5900 + (123900/100)
= $5900 + $1239 = $7139
Thus, Amount (A) to be paid = $7139 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 $5900, the simple interest in 1 year
= 3/100 × 5900
= 3 × 5900/100
= 17700/100 = $177
Thus, simple interest for 1 year = $177
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $177 × 7 = $1239
Thus, Simple Interest (SI) = $1239
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5900 + $1239
= $7139
Thus, Amount to be paid = $7139 Answer
Similar Questions
(1) Calculate the amount due if Charles borrowed a sum of $3900 at 4% simple interest for 4 years.
(2) Find the amount to be paid if Joseph borrowed a sum of $5700 at 10% simple interest for 7 years.
(3) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $10070 to clear the loan, then find the time period of the loan.
(4) Margaret took a loan of $6700 at the rate of 6% simple interest per annum. If he paid an amount of $9514 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due if Joseph borrowed a sum of $3700 at 3% simple interest for 4 years.
(6) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 7% simple interest.
(7) How much loan did Elizabeth borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6540 to clear it?
(8) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $13200 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 5% simple interest.
(10) Sarah took a loan of $5700 at the rate of 8% simple interest per annum. If he paid an amount of $9348 to clear the loan, then find the time period of the loan.