Question:
Find the amount to be paid if Christopher borrowed a sum of $6000 at 10% simple interest for 7 years.
Correct Answer
$10200
Solution And Explanation
Solution
Given,
Principal (P) = $6000
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) = $6000 × 10% × 7
= $6000 ×10/100 × 7
= 6000 × 10 × 7/100
= 60000 × 7/100
= 420000/100
= $4200
Thus, Simple Interest = $4200
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 = $6000 + $4200
= $10200
Thus, Amount to be paid = $10200 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 = $6000
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 7 years
Thus, Amount (A)
= $6000 + ($6000 × 10% × 7)
= $6000 + ($6000 ×10/100 × 7)
= $6000 + (6000 × 10 × 7/100)
= $6000 + (60000 × 7/100)
= $6000 + (420000/100)
= $6000 + $4200 = $10200
Thus, Amount (A) to be paid = $10200 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 $6000, the simple interest in 1 year
= 10/100 × 6000
= 10 × 6000/100
= 60000/100 = $600
Thus, simple interest for 1 year = $600
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $600 × 7 = $4200
Thus, Simple Interest (SI) = $4200
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $6000 + $4200
= $10200
Thus, Amount to be paid = $10200 Answer
Similar Questions
(1) Donald took a loan of $7000 at the rate of 8% simple interest per annum. If he paid an amount of $10360 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 10% simple interest.
(3) Calculate the amount due if Charles borrowed a sum of $3900 at 6% simple interest for 4 years.
(4) What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 10% simple interest?
(5) Calculate the amount due if Robert borrowed a sum of $3100 at 10% simple interest for 3 years.
(6) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 4% simple interest.
(7) Calculate the amount due if Barbara borrowed a sum of $3550 at 8% simple interest for 3 years.
(8) Thomas took a loan of $5600 at the rate of 9% simple interest per annum. If he paid an amount of $10136 to clear the loan, then find the time period of the loan.
(9) What amount does John have to pay after 5 years if he takes a loan of $3200 at 5% simple interest?
(10) If Susan paid $4234 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.