Question:
Find the amount to be paid if Thomas borrowed a sum of $5800 at 6% simple interest for 7 years.
Correct Answer
$8236
Solution And Explanation
Solution
Given,
Principal (P) = $5800
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) = $5800 × 6% × 7
= $5800 ×6/100 × 7
= 5800 × 6 × 7/100
= 34800 × 7/100
= 243600/100
= $2436
Thus, Simple Interest = $2436
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 = $5800 + $2436
= $8236
Thus, Amount to be paid = $8236 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 = $5800
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 7 years
Thus, Amount (A)
= $5800 + ($5800 × 6% × 7)
= $5800 + ($5800 ×6/100 × 7)
= $5800 + (5800 × 6 × 7/100)
= $5800 + (34800 × 7/100)
= $5800 + (243600/100)
= $5800 + $2436 = $8236
Thus, Amount (A) to be paid = $8236 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 $5800, the simple interest in 1 year
= 6/100 × 5800
= 6 × 5800/100
= 34800/100 = $348
Thus, simple interest for 1 year = $348
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $348 × 7 = $2436
Thus, Simple Interest (SI) = $2436
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $2436
= $8236
Thus, Amount to be paid = $8236 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 5% simple interest.
(2) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 8% simple interest?
(3) Calculate the amount due if William borrowed a sum of $3500 at 4% simple interest for 3 years.
(4) Calculate the amount due if Linda borrowed a sum of $3350 at 7% simple interest for 4 years.
(5) John took a loan of $4400 at the rate of 9% simple interest per annum. If he paid an amount of $7172 to clear the loan, then find the time period of the loan.
(6) Daniel took a loan of $6200 at the rate of 10% simple interest per annum. If he paid an amount of $12400 to clear the loan, then find the time period of the loan.
(7) What amount will be due after 2 years if Mark borrowed a sum of $3700 at a 10% simple interest?
(8) What amount does David have to pay after 5 years if he takes a loan of $3400 at 8% simple interest?
(9) Find the amount to be paid if Sarah borrowed a sum of $5850 at 2% simple interest for 8 years.
(10) What amount does John have to pay after 6 years if he takes a loan of $3200 at 9% simple interest?