Question:
Find the amount to be paid if Robert borrowed a sum of $5100 at 6% simple interest for 8 years.
Correct Answer
$7548
Solution And Explanation
Solution
Given,
Principal (P) = $5100
Rate of Simple Interest (SI) = 6%
Time (t) = 8 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $5100 × 6% × 8
= $5100 ×6/100 × 8
= 5100 × 6 × 8/100
= 30600 × 8/100
= 244800/100
= $2448
Thus, Simple Interest = $2448
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 = $5100 + $2448
= $7548
Thus, Amount to be paid = $7548 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 = $5100
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 8 years
Thus, Amount (A)
= $5100 + ($5100 × 6% × 8)
= $5100 + ($5100 ×6/100 × 8)
= $5100 + (5100 × 6 × 8/100)
= $5100 + (30600 × 8/100)
= $5100 + (244800/100)
= $5100 + $2448 = $7548
Thus, Amount (A) to be paid = $7548 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $5100, the simple interest in 1 year
= 6/100 × 5100
= 6 × 5100/100
= 30600/100 = $306
Thus, simple interest for 1 year = $306
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $306 × 8 = $2448
Thus, Simple Interest (SI) = $2448
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5100 + $2448
= $7548
Thus, Amount to be paid = $7548 Answer
Similar Questions
(1) Calculate the amount due if Jennifer borrowed a sum of $3250 at 6% simple interest for 4 years.
(2) If Jennifer borrowed $3250 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(3) Donald had to pay $4770 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(4) Sarah took a loan of $5700 at the rate of 8% simple interest per annum. If he paid an amount of $9348 to clear the loan, then find the time period of the loan.
(5) How much loan did Barbara borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6660 to clear it?
(6) Calculate the amount due after 10 years if Patricia borrowed a sum of $5150 at a rate of 3% simple interest.
(7) Barbara took a loan of $5100 at the rate of 7% simple interest per annum. If he paid an amount of $7242 to clear the loan, then find the time period of the loan.
(8) If Joshua paid $5684 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(9) How much loan did Susan borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6215 to clear it?
(10) Find the amount to be paid if Robert borrowed a sum of $5100 at 10% simple interest for 7 years.