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) Nancy took a loan of $6300 at the rate of 10% simple interest per annum. If he paid an amount of $12600 to clear the loan, then find the time period of the loan.
(2) What amount does Charles have to pay after 5 years if he takes a loan of $3900 at 7% simple interest?
(3) What amount does John have to pay after 5 years if he takes a loan of $3200 at 6% simple interest?
(4) Karen took a loan of $5900 at the rate of 8% simple interest per annum. If he paid an amount of $9676 to clear the loan, then find the time period of the loan.
(5) David had to pay $3910 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(6) Find the amount to be paid if James borrowed a sum of $5000 at 2% simple interest for 8 years.
(7) If Jessica paid $4350 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(8) Calculate the amount due if Jessica borrowed a sum of $3750 at 9% simple interest for 4 years.
(9) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $6660 to clear the loan, then find the time period of the loan.
(10) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 6% simple interest?