Question:
Find the amount to be paid if Charles borrowed a sum of $5900 at 9% simple interest for 7 years.
Correct Answer
$9617
Solution And Explanation
Solution
Given,
Principal (P) = $5900
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) = $5900 × 9% × 7
= $5900 ×9/100 × 7
= 5900 × 9 × 7/100
= 53100 × 7/100
= 371700/100
= $3717
Thus, Simple Interest = $3717
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 = $5900 + $3717
= $9617
Thus, Amount to be paid = $9617 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 = $5900
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 7 years
Thus, Amount (A)
= $5900 + ($5900 × 9% × 7)
= $5900 + ($5900 ×9/100 × 7)
= $5900 + (5900 × 9 × 7/100)
= $5900 + (53100 × 7/100)
= $5900 + (371700/100)
= $5900 + $3717 = $9617
Thus, Amount (A) to be paid = $9617 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 $5900, the simple interest in 1 year
= 9/100 × 5900
= 9 × 5900/100
= 53100/100 = $531
Thus, simple interest for 1 year = $531
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $531 × 7 = $3717
Thus, Simple Interest (SI) = $3717
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5900 + $3717
= $9617
Thus, Amount to be paid = $9617 Answer
Similar Questions
(1) David took a loan of $4800 at the rate of 8% simple interest per annum. If he paid an amount of $7104 to clear the loan, then find the time period of the loan.
(2) If Mary paid $3416 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(3) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 10% simple interest.
(4) What amount will be due after 2 years if Steven borrowed a sum of $3800 at a 5% simple interest?
(5) If Thomas paid $4408 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(6) Lisa took a loan of $6100 at the rate of 7% simple interest per annum. If he paid an amount of $9089 to clear the loan, then find the time period of the loan.
(7) Calculate the amount due if Jessica borrowed a sum of $3750 at 2% simple interest for 3 years.
(8) Calculate the amount due if Thomas borrowed a sum of $3800 at 5% simple interest for 3 years.
(9) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 8% simple interest?
(10) Daniel took a loan of $6200 at the rate of 8% simple interest per annum. If he paid an amount of $10664 to clear the loan, then find the time period of the loan.