Question:
Find the amount to be paid if Thomas borrowed a sum of $5800 at 6% simple interest for 8 years.
Correct Answer
$8584
Solution And Explanation
Solution
Given,
Principal (P) = $5800
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) = $5800 × 6% × 8
= $5800 ×6/100 × 8
= 5800 × 6 × 8/100
= 34800 × 8/100
= 278400/100
= $2784
Thus, Simple Interest = $2784
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 = $5800 + $2784
= $8584
Thus, Amount to be paid = $8584 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 = $5800
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 8 years
Thus, Amount (A)
= $5800 + ($5800 × 6% × 8)
= $5800 + ($5800 ×6/100 × 8)
= $5800 + (5800 × 6 × 8/100)
= $5800 + (34800 × 8/100)
= $5800 + (278400/100)
= $5800 + $2784 = $8584
Thus, Amount (A) to be paid = $8584 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 $5800, the simple interest in 1 year
= 6/100 × 5800
= 6 × 5800/100
= 34800/100 = $348
Thus, simple interest for 1 year = $348
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $348 × 8 = $2784
Thus, Simple Interest (SI) = $2784
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5800 + $2784
= $8584
Thus, Amount to be paid = $8584 Answer
Similar Questions
(1) Calculate the amount due if Richard borrowed a sum of $3600 at 4% simple interest for 4 years.
(2) Find the amount to be paid if Sarah borrowed a sum of $5850 at 10% simple interest for 8 years.
(3) Find the amount to be paid if Thomas borrowed a sum of $5800 at 3% simple interest for 8 years.
(4) Betty took a loan of $6500 at the rate of 9% simple interest per annum. If he paid an amount of $10010 to clear the loan, then find the time period of the loan.
(5) James took a loan of $4000 at the rate of 7% simple interest per annum. If he paid an amount of $6240 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if James borrowed a sum of $5000 at 5% simple interest for 7 years.
(7) Margaret took a loan of $6700 at the rate of 9% simple interest per annum. If he paid an amount of $10921 to clear the loan, then find the time period of the loan.
(8) Patricia took a loan of $4300 at the rate of 6% simple interest per annum. If he paid an amount of $6106 to clear the loan, then find the time period of the loan.
(9) What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 10% simple interest?
(10) In how much time a principal of $3150 will amount to $3622.5 at a simple interest of 5% per annum?