Question:
Find the amount to be paid if Christopher borrowed a sum of $6000 at 8% simple interest for 7 years.
Correct Answer
$9360
Solution And Explanation
Solution
Given,
Principal (P) = $6000
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) = $6000 × 8% × 7
= $6000 ×8/100 × 7
= 6000 × 8 × 7/100
= 48000 × 7/100
= 336000/100
= $3360
Thus, Simple Interest = $3360
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 + $3360
= $9360
Thus, Amount to be paid = $9360 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) = 8%
And, Time (t) = 7 years
Thus, Amount (A)
= $6000 + ($6000 × 8% × 7)
= $6000 + ($6000 ×8/100 × 7)
= $6000 + (6000 × 8 × 7/100)
= $6000 + (48000 × 7/100)
= $6000 + (336000/100)
= $6000 + $3360 = $9360
Thus, Amount (A) to be paid = $9360 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 $6000, the simple interest in 1 year
= 8/100 × 6000
= 8 × 6000/100
= 48000/100 = $480
Thus, simple interest for 1 year = $480
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $480 × 7 = $3360
Thus, Simple Interest (SI) = $3360
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $6000 + $3360
= $9360
Thus, Amount to be paid = $9360 Answer
Similar Questions
(1) James took a loan of $4000 at the rate of 7% simple interest per annum. If he paid an amount of $5680 to clear the loan, then find the time period of the loan.
(2) Michael took a loan of $4600 at the rate of 6% simple interest per annum. If he paid an amount of $7084 to clear the loan, then find the time period of the loan.
(3) In how much time a principal of $3150 will amount to $3465 at a simple interest of 5% per annum?
(4) Find the amount to be paid if Mary borrowed a sum of $5050 at 5% simple interest for 8 years.
(5) Calculate the amount due after 9 years if Christopher borrowed a sum of $6000 at a rate of 3% simple interest.
(6) Calculate the amount due after 10 years if William borrowed a sum of $5500 at a rate of 6% simple interest.
(7) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 4% simple interest.
(8) If Steven paid $5152 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(9) Emily had to pay $5177.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(10) Daniel took a loan of $6200 at the rate of 6% simple interest per annum. If he paid an amount of $8432 to clear the loan, then find the time period of the loan.