Question:
Find the amount to be paid if Charles borrowed a sum of $5900 at 9% simple interest for 8 years.
Correct Answer
$10148
Solution And Explanation
Solution
Given,
Principal (P) = $5900
Rate of Simple Interest (SI) = 9%
Time (t) = 8 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $5900 × 9% × 8
= $5900 ×9/100 × 8
= 5900 × 9 × 8/100
= 53100 × 8/100
= 424800/100
= $4248
Thus, Simple Interest = $4248
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 = $5900 + $4248
= $10148
Thus, Amount to be paid = $10148 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 = $5900
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 8 years
Thus, Amount (A)
= $5900 + ($5900 × 9% × 8)
= $5900 + ($5900 ×9/100 × 8)
= $5900 + (5900 × 9 × 8/100)
= $5900 + (53100 × 8/100)
= $5900 + (424800/100)
= $5900 + $4248 = $10148
Thus, Amount (A) to be paid = $10148 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $5900, the simple interest in 1 year
= 9/100 × 5900
= 9 × 5900/100
= 53100/100 = $531
Thus, simple interest for 1 year = $531
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $531 × 8 = $4248
Thus, Simple Interest (SI) = $4248
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5900 + $4248
= $10148
Thus, Amount to be paid = $10148 Answer
Similar Questions
(1) Find the amount to be paid if William borrowed a sum of $5500 at 7% simple interest for 8 years.
(2) Susan took a loan of $5300 at the rate of 9% simple interest per annum. If he paid an amount of $9593 to clear the loan, then find the time period of the loan.
(3) Daniel took a loan of $6200 at the rate of 7% simple interest per annum. If he paid an amount of $10106 to clear the loan, then find the time period of the loan.
(4) What amount does Jessica have to pay after 5 years if he takes a loan of $3750 at 2% simple interest?
(5) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 8% simple interest.
(6) Calculate the amount due if Jennifer borrowed a sum of $3250 at 7% simple interest for 3 years.
(7) Matthew took a loan of $6400 at the rate of 6% simple interest per annum. If he paid an amount of $9472 to clear the loan, then find the time period of the loan.
(8) Ashley had to pay $4959.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(9) If Charles paid $4368 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(10) Linda took a loan of $4700 at the rate of 10% simple interest per annum. If he paid an amount of $7990 to clear the loan, then find the time period of the loan.