Question:
Find the amount to be paid if Christopher borrowed a sum of $6000 at 9% simple interest for 8 years.
Correct Answer
$10320
Solution And Explanation
Solution
Given,
Principal (P) = $6000
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) = $6000 × 9% × 8
= $6000 ×9/100 × 8
= 6000 × 9 × 8/100
= 54000 × 8/100
= 432000/100
= $4320
Thus, Simple Interest = $4320
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 = $6000 + $4320
= $10320
Thus, Amount to be paid = $10320 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 = $6000
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 8 years
Thus, Amount (A)
= $6000 + ($6000 × 9% × 8)
= $6000 + ($6000 ×9/100 × 8)
= $6000 + (6000 × 9 × 8/100)
= $6000 + (54000 × 8/100)
= $6000 + (432000/100)
= $6000 + $4320 = $10320
Thus, Amount (A) to be paid = $10320 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 $6000, the simple interest in 1 year
= 9/100 × 6000
= 9 × 6000/100
= 54000/100 = $540
Thus, simple interest for 1 year = $540
Therefore, simple interest for 8 years
= Simple interest for 1 year × 8
= $540 × 8 = $4320
Thus, Simple Interest (SI) = $4320
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $6000 + $4320
= $10320
Thus, Amount to be paid = $10320 Answer
Similar Questions
(1) What amount does Sarah have to pay after 5 years if he takes a loan of $3850 at 2% simple interest?
(2) What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 6% simple interest?
(3) Calculate the amount due if Charles borrowed a sum of $3900 at 2% simple interest for 3 years.
(4) Karen took a loan of $5900 at the rate of 7% simple interest per annum. If he paid an amount of $9617 to clear the loan, then find the time period of the loan.
(5) Mark took a loan of $6800 at the rate of 9% simple interest per annum. If he paid an amount of $12308 to clear the loan, then find the time period of the loan.
(6) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 9% simple interest?
(7) In how much time a principal of $3000 will amount to $3360 at a simple interest of 3% per annum?
(8) Find the amount to be paid if Barbara borrowed a sum of $5550 at 3% simple interest for 7 years.
(9) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 5% simple interest for 7 years.
(10) How much loan did Carol borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7755 to clear it?