Question:
Find the amount to be paid if Joseph borrowed a sum of $5700 at 10% simple interest for 7 years.
Correct Answer
$9690
Solution And Explanation
Solution
Given,
Principal (P) = $5700
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) = $5700 × 10% × 7
= $5700 ×10/100 × 7
= 5700 × 10 × 7/100
= 57000 × 7/100
= 399000/100
= $3990
Thus, Simple Interest = $3990
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 = $5700 + $3990
= $9690
Thus, Amount to be paid = $9690 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 = $5700
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 7 years
Thus, Amount (A)
= $5700 + ($5700 × 10% × 7)
= $5700 + ($5700 ×10/100 × 7)
= $5700 + (5700 × 10 × 7/100)
= $5700 + (57000 × 7/100)
= $5700 + (399000/100)
= $5700 + $3990 = $9690
Thus, Amount (A) to be paid = $9690 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 $5700, the simple interest in 1 year
= 10/100 × 5700
= 10 × 5700/100
= 57000/100 = $570
Thus, simple interest for 1 year = $570
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $570 × 7 = $3990
Thus, Simple Interest (SI) = $3990
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5700 + $3990
= $9690
Thus, Amount to be paid = $9690 Answer
Similar Questions
(1) Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $9230 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due if Mary borrowed a sum of $3050 at 4% simple interest for 3 years.
(3) Jessica took a loan of $5500 at the rate of 9% simple interest per annum. If he paid an amount of $9460 to clear the loan, then find the time period of the loan.
(4) How much loan did Kevin borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7810 to clear it?
(5) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $9240 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if Linda borrowed a sum of $5350 at 7% simple interest for 8 years.
(7) Jessica took a loan of $5500 at the rate of 7% simple interest per annum. If he paid an amount of $8195 to clear the loan, then find the time period of the loan.
(8) What amount will be due after 2 years if John borrowed a sum of $3100 at a 7% simple interest?
(9) How much loan did Michelle borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7992.5 to clear it?
(10) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $9768 to clear the loan, then find the time period of the loan.