Question:
Find the amount to be paid if Christopher borrowed a sum of $6000 at 6% simple interest for 7 years.
Correct Answer
$8520
Solution And Explanation
Solution
Given,
Principal (P) = $6000
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) = $6000 × 6% × 7
= $6000 ×6/100 × 7
= 6000 × 6 × 7/100
= 36000 × 7/100
= 252000/100
= $2520
Thus, Simple Interest = $2520
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 = $6000 + $2520
= $8520
Thus, Amount to be paid = $8520 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 = $6000
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 7 years
Thus, Amount (A)
= $6000 + ($6000 × 6% × 7)
= $6000 + ($6000 ×6/100 × 7)
= $6000 + (6000 × 6 × 7/100)
= $6000 + (36000 × 7/100)
= $6000 + (252000/100)
= $6000 + $2520 = $8520
Thus, Amount (A) to be paid = $8520 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 $6000, the simple interest in 1 year
= 6/100 × 6000
= 6 × 6000/100
= 36000/100 = $360
Thus, simple interest for 1 year = $360
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $360 × 7 = $2520
Thus, Simple Interest (SI) = $2520
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $6000 + $2520
= $8520
Thus, Amount to be paid = $8520 Answer
Similar Questions
(1) Mary took a loan of $4100 at the rate of 10% simple interest per annum. If he paid an amount of $8200 to clear the loan, then find the time period of the loan.
(2) How much loan did Donna borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7535 to clear it?
(3) Find the amount to be paid if Karen borrowed a sum of $5950 at 2% simple interest for 8 years.
(4) How much loan did Sandra borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7417.5 to clear it?
(5) In how much time a principal of $3050 will amount to $3294 at a simple interest of 4% per annum?
(6) Calculate the amount due if Sarah borrowed a sum of $3850 at 8% simple interest for 4 years.
(7) If Patricia paid $3654 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 Thomas borrowed a sum of $3800 at 6% simple interest for 3 years.
(9) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 10% simple interest.
(10) If Joseph borrowed $3700 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.