Question:
Find the amount to be paid if Linda borrowed a sum of $5350 at 6% simple interest for 8 years.
Correct Answer
$7918
Solution And Explanation
Solution
Given,
Principal (P) = $5350
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) = $5350 × 6% × 8
= $5350 ×6/100 × 8
= 5350 × 6 × 8/100
= 32100 × 8/100
= 256800/100
= $2568
Thus, Simple Interest = $2568
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 = $5350 + $2568
= $7918
Thus, Amount to be paid = $7918 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 = $5350
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 8 years
Thus, Amount (A)
= $5350 + ($5350 × 6% × 8)
= $5350 + ($5350 ×6/100 × 8)
= $5350 + (5350 × 6 × 8/100)
= $5350 + (32100 × 8/100)
= $5350 + (256800/100)
= $5350 + $2568 = $7918
Thus, Amount (A) to be paid = $7918 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 $5350, the simple interest in 1 year
= 6/100 × 5350
= 6 × 5350/100
= 32100/100 = $321
Thus, simple interest for 1 year = $321
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $321 × 8 = $2568
Thus, Simple Interest (SI) = $2568
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5350 + $2568
= $7918
Thus, Amount to be paid = $7918 Answer
Similar Questions
(1) Find the amount to be paid if Susan borrowed a sum of $5650 at 7% simple interest for 8 years.
(2) Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 4% simple interest.
(3) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 5% simple interest.
(4) What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 9% simple interest?
(5) Jessica took a loan of $5500 at the rate of 9% simple interest per annum. If he paid an amount of $8965 to clear the loan, then find the time period of the loan.
(6) What amount does Mary have to pay after 5 years if he takes a loan of $3050 at 5% simple interest?
(7) Donald took a loan of $7000 at the rate of 6% simple interest per annum. If he paid an amount of $10780 to clear the loan, then find the time period of the loan.
(8) How much loan did Ashley borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7532.5 to clear it?
(9) If Barbara paid $4260 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(10) How much loan did Jacob borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8800 to clear it?