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) How much loan did Brian borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8280 to clear it?
(2) If Kimberly paid $5580 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(3) Find the amount to be paid if Jessica borrowed a sum of $5750 at 9% simple interest for 8 years.
(4) Find the amount to be paid if Christopher borrowed a sum of $6000 at 3% simple interest for 7 years.
(5) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 4% simple interest.
(6) Find the amount to be paid if Karen borrowed a sum of $5950 at 7% simple interest for 8 years.
(7) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 9% simple interest.
(8) Nancy took a loan of $6300 at the rate of 7% simple interest per annum. If he paid an amount of $9828 to clear the loan, then find the time period of the loan.
(9) How much loan did Sharon borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9300 to clear it?
(10) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $11880 to clear the loan, then find the time period of the loan.