Question:
Find the amount to be paid if Thomas borrowed a sum of $5800 at 8% simple interest for 7 years.
Correct Answer
$9048
Solution And Explanation
Solution
Given,
Principal (P) = $5800
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) = $5800 × 8% × 7
= $5800 ×8/100 × 7
= 5800 × 8 × 7/100
= 46400 × 7/100
= 324800/100
= $3248
Thus, Simple Interest = $3248
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 = $5800 + $3248
= $9048
Thus, Amount to be paid = $9048 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 = $5800
Rate of Simple Interest (SI) or (R) = 8%
And, Time (t) = 7 years
Thus, Amount (A)
= $5800 + ($5800 × 8% × 7)
= $5800 + ($5800 ×8/100 × 7)
= $5800 + (5800 × 8 × 7/100)
= $5800 + (46400 × 7/100)
= $5800 + (324800/100)
= $5800 + $3248 = $9048
Thus, Amount (A) to be paid = $9048 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 $5800, the simple interest in 1 year
= 8/100 × 5800
= 8 × 5800/100
= 46400/100 = $464
Thus, simple interest for 1 year = $464
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $464 × 7 = $3248
Thus, Simple Interest (SI) = $3248
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $3248
= $9048
Thus, Amount to be paid = $9048 Answer
Similar Questions
(1) Calculate the amount due if Karen borrowed a sum of $3950 at 4% simple interest for 3 years.
(2) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 6% simple interest?
(3) Calculate the amount due if James borrowed a sum of $3000 at 4% simple interest for 4 years.
(4) Calculate the amount due if Sarah borrowed a sum of $3850 at 4% simple interest for 3 years.
(5) Margaret had to pay $4611 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(6) Find the amount to be paid if Jessica borrowed a sum of $5750 at 8% simple interest for 8 years.
(7) Linda took a loan of $4700 at the rate of 6% simple interest per annum. If he paid an amount of $6956 to clear the loan, then find the time period of the loan.
(8) If Andrew paid $5376 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(9) What amount does James have to pay after 6 years if he takes a loan of $3000 at 8% simple interest?
(10) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 3% simple interest?