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) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $7392 to clear the loan, then find the time period of the loan.
(2) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $7380 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Charles borrowed a sum of $5900 at 6% simple interest for 7 years.
(4) What amount will be due after 2 years if Mark borrowed a sum of $3700 at a 9% simple interest?
(5) John had to pay $3488 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(6) How much loan did Dorothy borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9062.5 to clear it?
(7) Calculate the amount due if Charles borrowed a sum of $3900 at 10% simple interest for 4 years.
(8) If Elizabeth paid $3726 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(9) How much loan did Carol borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8460 to clear it?
(10) Find the amount to be paid if Jessica borrowed a sum of $5750 at 10% simple interest for 7 years.