Question:
( 1 of 10 ) Find the amount to be paid if Joseph borrowed a sum of $5700 at 8% simple interest for 7 years.
(A) 753
(B) 376
(C) 751
(D) 752
You selected
$5700
Correct Answer
$8892
Solution And Explanation
Solution
Given,
Principal (P) = $5700
Rate of Simple Interest (SI) = 8%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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) = $5700 × 8% × 7
= $5700 ×8/100 × 7
= 5700 × 8 × 7/100
= 45600 × 7/100
= 319200/100
= $3192
Thus, Simple Interest = $3192
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 = $5700 + $3192
= $8892
Thus, Amount to be paid = $8892 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 = $5700
Rate of Simple Interest (SI) or (R) = 8%
And, Time (t) = 7 years
Thus, Amount (A)
= $5700 + ($5700 × 8% × 7)
= $5700 + ($5700 ×8/100 × 7)
= $5700 + (5700 × 8 × 7/100)
= $5700 + (45600 × 7/100)
= $5700 + (319200/100)
= $5700 + $3192 = $8892
Thus, Amount (A) to be paid = $8892 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 8%
This, means, $8 per $100 per year
∵ For $100, the simple interest for 1 year = $8
∴ For $1, the simple interest for 1 year = 8/100
∴ For $5700, the simple interest in 1 year
= 8/100 × 5700
= 8 × 5700/100
= 45600/100 = $456
Thus, simple interest for 1 year = $456
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $456 × 7 = $3192
Thus, Simple Interest (SI) = $3192
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5700 + $3192
= $8892
Thus, Amount to be paid = $8892 Answer
Similar Questions
(1) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 10% simple interest?
(2) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 2% simple interest?
(3) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $11390 to clear the loan, then find the time period of the loan.
(4) If Sandra paid $4984 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(5) How much loan did Matthew borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7750 to clear it?
(6) Find the amount to be paid if Mary borrowed a sum of $5050 at 5% simple interest for 7 years.
(7) Calculate the amount due if James borrowed a sum of $3000 at 9% simple interest for 3 years.
(8) Calculate the amount due after 9 years if Sarah borrowed a sum of $5850 at a rate of 5% simple interest.
(9) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $7824 to clear the loan, then find the time period of the loan.
(10) William took a loan of $5000 at the rate of 6% simple interest per annum. If he paid an amount of $8000 to clear the loan, then find the time period of the loan.