Question:
Find the amount to be paid if Susan borrowed a sum of $5650 at 4% simple interest for 7 years.
Correct Answer
$7232
Solution And Explanation
Solution
Given,
Principal (P) = $5650
Rate of Simple Interest (SI) = 4%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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 × 4% × 7
= $5650 ×4/100 × 7
= 5650 × 4 × 7/100
= 22600 × 7/100
= 158200/100
= $1582
Thus, Simple Interest = $1582
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 + $1582
= $7232
Thus, Amount to be paid = $7232 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) = 4%
And, Time (t) = 7 years
Thus, Amount (A)
= $5650 + ($5650 × 4% × 7)
= $5650 + ($5650 ×4/100 × 7)
= $5650 + (5650 × 4 × 7/100)
= $5650 + (22600 × 7/100)
= $5650 + (158200/100)
= $5650 + $1582 = $7232
Thus, Amount (A) to be paid = $7232 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 4%
This, means, $4 per $100 per year
∵ For $100, the simple interest for 1 year = $4
∴ For $1, the simple interest for 1 year = 4/100
∴ For $5650, the simple interest in 1 year
= 4/100 × 5650
= 4 × 5650/100
= 22600/100 = $226
Thus, simple interest for 1 year = $226
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $226 × 7 = $1582
Thus, Simple Interest (SI) = $1582
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5650 + $1582
= $7232
Thus, Amount to be paid = $7232 Answer
Similar Questions
(1) Thomas took a loan of $5600 at the rate of 7% simple interest per annum. If he paid an amount of $9520 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 7% simple interest.
(3) James took a loan of $4000 at the rate of 7% simple interest per annum. If he paid an amount of $6800 to clear the loan, then find the time period of the loan.
(4) What amount will be due after 2 years if John borrowed a sum of $3100 at a 6% simple interest?
(5) Find the amount to be paid if Susan borrowed a sum of $5650 at 6% simple interest for 7 years.
(6) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.
(7) Find the amount to be paid if Mary borrowed a sum of $5050 at 3% simple interest for 8 years.
(8) Calculate the amount due if William borrowed a sum of $3500 at 4% simple interest for 3 years.
(9) Calculate the amount due if Patricia borrowed a sum of $3150 at 2% simple interest for 3 years.
(10) Find the amount to be paid if Joseph borrowed a sum of $5700 at 10% simple interest for 8 years.