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) Find the amount to be paid if David borrowed a sum of $5400 at 8% simple interest for 8 years.
(2) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 8% simple interest.
(3) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 5% simple interest?
(4) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 8% simple interest.
(5) How much loan did Stephanie borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8305 to clear it?
(6) Calculate the amount due after 9 years if Christopher borrowed a sum of $6000 at a rate of 7% simple interest.
(7) Betty took a loan of $6500 at the rate of 8% simple interest per annum. If he paid an amount of $11700 to clear the loan, then find the time period of the loan.
(8) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $9916 to clear the loan, then find the time period of the loan.
(9) Anthony had to pay $4945 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(10) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 10% simple interest?