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 if John borrowed a sum of $3200 at 10% simple interest for 3 years.
(2) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $9548 to clear the loan, then find the time period of the loan.
(3) If Matthew paid $4536 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(4) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 3% simple interest?
(5) Calculate the amount due after 9 years if Robert borrowed a sum of $5100 at a rate of 3% simple interest.
(6) Christopher took a loan of $6000 at the rate of 6% simple interest per annum. If he paid an amount of $8160 to clear the loan, then find the time period of the loan.
(7) Find the amount to be paid if David borrowed a sum of $5400 at 8% simple interest for 7 years.
(8) If Donald paid $5400 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(9) What amount will be due after 2 years if William borrowed a sum of $3250 at a 6% simple interest?
(10) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 4% simple interest.