Question:
Find the amount to be paid if Thomas borrowed a sum of $5800 at 9% simple interest for 7 years.
Correct Answer
$9454
Solution And Explanation
Solution
Given,
Principal (P) = $5800
Rate of Simple Interest (SI) = 9%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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 × 9% × 7
= $5800 ×9/100 × 7
= 5800 × 9 × 7/100
= 52200 × 7/100
= 365400/100
= $3654
Thus, Simple Interest = $3654
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 + $3654
= $9454
Thus, Amount to be paid = $9454 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) = 9%
And, Time (t) = 7 years
Thus, Amount (A)
= $5800 + ($5800 × 9% × 7)
= $5800 + ($5800 ×9/100 × 7)
= $5800 + (5800 × 9 × 7/100)
= $5800 + (52200 × 7/100)
= $5800 + (365400/100)
= $5800 + $3654 = $9454
Thus, Amount (A) to be paid = $9454 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $5800, the simple interest in 1 year
= 9/100 × 5800
= 9 × 5800/100
= 52200/100 = $522
Thus, simple interest for 1 year = $522
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $522 × 7 = $3654
Thus, Simple Interest (SI) = $3654
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $3654
= $9454
Thus, Amount to be paid = $9454 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 9% simple interest.
(2) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 10% simple interest?
(3) If Sarah borrowed $3850 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(4) Ashley had to pay $5232.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(5) Calculate the amount due if Joseph borrowed a sum of $3700 at 5% simple interest for 3 years.
(6) Find the amount to be paid if John borrowed a sum of $5200 at 3% simple interest for 7 years.
(7) John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $6512 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 6% simple interest.
(9) What amount will be due after 2 years if Thomas borrowed a sum of $3400 at a 7% simple interest?
(10) Calculate the amount due if William borrowed a sum of $3500 at 3% simple interest for 3 years.