Question:
Find the amount to be paid if Christopher borrowed a sum of $6000 at 7% simple interest for 7 years.
Correct Answer
$8940
Solution And Explanation
Solution
Given,
Principal (P) = $6000
Rate of Simple Interest (SI) = 7%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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 × 7% × 7
= $6000 ×7/100 × 7
= 6000 × 7 × 7/100
= 42000 × 7/100
= 294000/100
= $2940
Thus, Simple Interest = $2940
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 + $2940
= $8940
Thus, Amount to be paid = $8940 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) = 7%
And, Time (t) = 7 years
Thus, Amount (A)
= $6000 + ($6000 × 7% × 7)
= $6000 + ($6000 ×7/100 × 7)
= $6000 + (6000 × 7 × 7/100)
= $6000 + (42000 × 7/100)
= $6000 + (294000/100)
= $6000 + $2940 = $8940
Thus, Amount (A) to be paid = $8940 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 7%
This, means, $7 per $100 per year
∵ For $100, the simple interest for 1 year = $7
∴ For $1, the simple interest for 1 year = 7/100
∴ For $6000, the simple interest in 1 year
= 7/100 × 6000
= 7 × 6000/100
= 42000/100 = $420
Thus, simple interest for 1 year = $420
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $420 × 7 = $2940
Thus, Simple Interest (SI) = $2940
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $6000 + $2940
= $8940
Thus, Amount to be paid = $8940 Answer
Similar Questions
(1) Calculate the amount due if Susan borrowed a sum of $3650 at 2% simple interest for 4 years.
(2) What amount does William have to pay after 5 years if he takes a loan of $3500 at 2% simple interest?
(3) Mary took a loan of $4100 at the rate of 9% simple interest per annum. If he paid an amount of $6314 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 9% simple interest for 8 years.
(5) Karen took a loan of $5900 at the rate of 7% simple interest per annum. If he paid an amount of $8378 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if Robert borrowed a sum of $5100 at 6% simple interest for 8 years.
(7) Calculate the amount due after 9 years if Sarah borrowed a sum of $5850 at a rate of 3% simple interest.
(8) Betty took a loan of $6500 at the rate of 10% simple interest per annum. If he paid an amount of $11700 to clear the loan, then find the time period of the loan.
(9) Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $10010 to clear the loan, then find the time period of the loan.
(10) Susan took a loan of $5300 at the rate of 6% simple interest per annum. If he paid an amount of $8162 to clear the loan, then find the time period of the loan.