Question:
Find the amount to be paid if Christopher borrowed a sum of $6000 at 3% simple interest for 7 years.
Correct Answer
$7260
Solution And Explanation
Solution
Given,
Principal (P) = $6000
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) = $6000 × 3% × 7
= $6000 ×3/100 × 7
= 6000 × 3 × 7/100
= 18000 × 7/100
= 126000/100
= $1260
Thus, Simple Interest = $1260
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 = $6000 + $1260
= $7260
Thus, Amount to be paid = $7260 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 = $6000
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 7 years
Thus, Amount (A)
= $6000 + ($6000 × 3% × 7)
= $6000 + ($6000 ×3/100 × 7)
= $6000 + (6000 × 3 × 7/100)
= $6000 + (18000 × 7/100)
= $6000 + (126000/100)
= $6000 + $1260 = $7260
Thus, Amount (A) to be paid = $7260 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 $6000, the simple interest in 1 year
= 3/100 × 6000
= 3 × 6000/100
= 18000/100 = $180
Thus, simple interest for 1 year = $180
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $180 × 7 = $1260
Thus, Simple Interest (SI) = $1260
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $6000 + $1260
= $7260
Thus, Amount to be paid = $7260 Answer
Similar Questions
(1) Find the amount to be paid if William borrowed a sum of $5500 at 4% simple interest for 7 years.
(2) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $7020 to clear the loan, then find the time period of the loan.
(3) Charles took a loan of $5800 at the rate of 6% simple interest per annum. If he paid an amount of $7888 to clear the loan, then find the time period of the loan.
(4) Matthew took a loan of $6400 at the rate of 7% simple interest per annum. If he paid an amount of $9984 to clear the loan, then find the time period of the loan.
(5) Barbara took a loan of $5100 at the rate of 10% simple interest per annum. If he paid an amount of $9690 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if William borrowed a sum of $5500 at 6% simple interest for 8 years.
(7) Calculate the amount due if William borrowed a sum of $3500 at 6% simple interest for 3 years.
(8) If James paid $3240 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(9) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 5% simple interest?
(10) John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $7040 to clear the loan, then find the time period of the loan.