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 James borrowed a sum of $3000 at 2% simple interest for 4 years.
(2) Calculate the amount due if Sarah borrowed a sum of $3850 at 6% simple interest for 3 years.
(3) Robert took a loan of $4200 at the rate of 8% simple interest per annum. If he paid an amount of $6552 to clear the loan, then find the time period of the loan.
(4) Kimberly had to pay $4929 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(5) Calculate the amount due if Joseph borrowed a sum of $3700 at 3% simple interest for 3 years.
(6) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 10% simple interest.
(7) Calculate the amount due if John borrowed a sum of $3200 at 3% simple interest for 4 years.
(8) In how much time a principal of $3150 will amount to $3622.5 at a simple interest of 3% per annum?
(9) Betty took a loan of $6500 at the rate of 10% simple interest per annum. If he paid an amount of $11700 to clear the loan, then find the time period of the loan.
(10) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 9% simple interest for 7 years.