Question:
Find the amount to be paid if Charles borrowed a sum of $5900 at 6% simple interest for 7 years.
Correct Answer
$8378
Solution And Explanation
Solution
Given,
Principal (P) = $5900
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) = $5900 × 6% × 7
= $5900 ×6/100 × 7
= 5900 × 6 × 7/100
= 35400 × 7/100
= 247800/100
= $2478
Thus, Simple Interest = $2478
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 + $2478
= $8378
Thus, Amount to be paid = $8378 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) = 6%
And, Time (t) = 7 years
Thus, Amount (A)
= $5900 + ($5900 × 6% × 7)
= $5900 + ($5900 ×6/100 × 7)
= $5900 + (5900 × 6 × 7/100)
= $5900 + (35400 × 7/100)
= $5900 + (247800/100)
= $5900 + $2478 = $8378
Thus, Amount (A) to be paid = $8378 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 $5900, the simple interest in 1 year
= 6/100 × 5900
= 6 × 5900/100
= 35400/100 = $354
Thus, simple interest for 1 year = $354
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $354 × 7 = $2478
Thus, Simple Interest (SI) = $2478
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5900 + $2478
= $8378
Thus, Amount to be paid = $8378 Answer
Similar Questions
(1) Anthony took a loan of $6600 at the rate of 7% simple interest per annum. If he paid an amount of $11220 to clear the loan, then find the time period of the loan.
(2) What amount will be due after 2 years if Robert borrowed a sum of $3050 at a 9% simple interest?
(3) Lisa took a loan of $6100 at the rate of 9% simple interest per annum. If he paid an amount of $11041 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due if Christopher borrowed a sum of $4000 at 9% simple interest for 3 years.
(5) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 5% simple interest.
(6) Richard had to pay $3924 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(7) Find the amount to be paid if Susan borrowed a sum of $5650 at 6% simple interest for 7 years.
(8) What amount does William have to pay after 6 years if he takes a loan of $3500 at 4% simple interest?
(9) Elizabeth took a loan of $4900 at the rate of 8% simple interest per annum. If he paid an amount of $7644 to clear the loan, then find the time period of the loan.
(10) If William borrowed $3500 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.