Question:
Find the amount to be paid if Richard borrowed a sum of $5600 at 6% simple interest for 8 years.
Correct Answer
$8288
Solution And Explanation
Solution
Given,
Principal (P) = $5600
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) = $5600 × 6% × 8
= $5600 ×6/100 × 8
= 5600 × 6 × 8/100
= 33600 × 8/100
= 268800/100
= $2688
Thus, Simple Interest = $2688
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 = $5600 + $2688
= $8288
Thus, Amount to be paid = $8288 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 = $5600
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 8 years
Thus, Amount (A)
= $5600 + ($5600 × 6% × 8)
= $5600 + ($5600 ×6/100 × 8)
= $5600 + (5600 × 6 × 8/100)
= $5600 + (33600 × 8/100)
= $5600 + (268800/100)
= $5600 + $2688 = $8288
Thus, Amount (A) to be paid = $8288 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 $5600, the simple interest in 1 year
= 6/100 × 5600
= 6 × 5600/100
= 33600/100 = $336
Thus, simple interest for 1 year = $336
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $336 × 8 = $2688
Thus, Simple Interest (SI) = $2688
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5600 + $2688
= $8288
Thus, Amount to be paid = $8288 Answer
Similar Questions
(1) What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 6% simple interest?
(2) Patricia took a loan of $4300 at the rate of 8% simple interest per annum. If he paid an amount of $7740 to clear the loan, then find the time period of the loan.
(3) Joseph had to pay $4144 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(4) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 7% simple interest?
(5) If Barbara paid $3976 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(6) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 7% simple interest.
(7) If Jessica paid $4500 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(8) Anthony took a loan of $6600 at the rate of 7% simple interest per annum. If he paid an amount of $11220 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if Jessica borrowed a sum of $5750 at 10% simple interest for 8 years.
(10) Calculate the amount due after 9 years if Sarah borrowed a sum of $5850 at a rate of 2% simple interest.