Question:
Find the amount to be paid if Richard borrowed a sum of $5600 at 6% simple interest for 7 years.
Correct Answer
$7952
Solution And Explanation
Solution
Given,
Principal (P) = $5600
Rate of Simple Interest (SI) = 6%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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 × 6% × 7
= $5600 ×6/100 × 7
= 5600 × 6 × 7/100
= 33600 × 7/100
= 235200/100
= $2352
Thus, Simple Interest = $2352
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 + $2352
= $7952
Thus, Amount to be paid = $7952 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) = 6%
And, Time (t) = 7 years
Thus, Amount (A)
= $5600 + ($5600 × 6% × 7)
= $5600 + ($5600 ×6/100 × 7)
= $5600 + (5600 × 6 × 7/100)
= $5600 + (33600 × 7/100)
= $5600 + (235200/100)
= $5600 + $2352 = $7952
Thus, Amount (A) to be paid = $7952 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $5600, the simple interest in 1 year
= 6/100 × 5600
= 6 × 5600/100
= 33600/100 = $336
Thus, simple interest for 1 year = $336
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $336 × 7 = $2352
Thus, Simple Interest (SI) = $2352
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $2352
= $7952
Thus, Amount to be paid = $7952 Answer
Similar Questions
(1) Calculate the amount due if Patricia borrowed a sum of $3150 at 6% simple interest for 4 years.
(2) Karen took a loan of $5900 at the rate of 9% simple interest per annum. If he paid an amount of $10148 to clear the loan, then find the time period of the loan.
(3) What amount does John have to pay after 6 years if he takes a loan of $3200 at 6% simple interest?
(4) Thomas took a loan of $5600 at the rate of 9% simple interest per annum. If he paid an amount of $8624 to clear the loan, then find the time period of the loan.
(5) Find the amount to be paid if Robert borrowed a sum of $5100 at 10% simple interest for 7 years.
(6) Calculate the amount due after 10 years if William borrowed a sum of $5500 at a rate of 7% simple interest.
(7) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 4% simple interest.
(8) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $8268 to clear the loan, then find the time period of the loan.
(9) How much loan did Daniel borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7320 to clear it?
(10) Calculate the amount due if Jessica borrowed a sum of $3750 at 10% simple interest for 3 years.