Question:
( 1 of 10 ) Find the amount to be paid if David borrowed a sum of $5400 at 10% simple interest for 7 years.
(A) 59
(B) 30.5
(C) 61
(D) 60
You selected
$5400
Correct Answer
$9180
Solution And Explanation
Solution
Given,
Principal (P) = $5400
Rate of Simple Interest (SI) = 10%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $5400 × 10% × 7
= $5400 ×10/100 × 7
= 5400 × 10 × 7/100
= 54000 × 7/100
= 378000/100
= $3780
Thus, Simple Interest = $3780
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 = $5400 + $3780
= $9180
Thus, Amount to be paid = $9180 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 = $5400
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 7 years
Thus, Amount (A)
= $5400 + ($5400 × 10% × 7)
= $5400 + ($5400 ×10/100 × 7)
= $5400 + (5400 × 10 × 7/100)
= $5400 + (54000 × 7/100)
= $5400 + (378000/100)
= $5400 + $3780 = $9180
Thus, Amount (A) to be paid = $9180 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 10%
This, means, $10 per $100 per year
∵ For $100, the simple interest for 1 year = $10
∴ For $1, the simple interest for 1 year = 10/100
∴ For $5400, the simple interest in 1 year
= 10/100 × 5400
= 10 × 5400/100
= 54000/100 = $540
Thus, simple interest for 1 year = $540
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $540 × 7 = $3780
Thus, Simple Interest (SI) = $3780
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5400 + $3780
= $9180
Thus, Amount to be paid = $9180 Answer
Similar Questions
(1) Karen took a loan of $5900 at the rate of 6% simple interest per annum. If he paid an amount of $9440 to clear the loan, then find the time period of the loan.
(2) Paul had to pay $4982 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(3) What amount will be due after 2 years if David borrowed a sum of $3200 at a 7% simple interest?
(4) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 7% simple interest.
(5) What amount does Sarah have to pay after 5 years if he takes a loan of $3850 at 5% simple interest?
(6) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 8% simple interest.
(7) David took a loan of $4800 at the rate of 7% simple interest per annum. If he paid an amount of $7824 to clear the loan, then find the time period of the loan.
(8) In how much time a principal of $3000 will amount to $3120 at a simple interest of 2% per annum?
(9) What amount does David have to pay after 5 years if he takes a loan of $3400 at 9% simple interest?
(10) Calculate the amount due if Jessica borrowed a sum of $3750 at 7% simple interest for 3 years.