Simple Interest
Math MCQs

Question :    If Patricia borrowed $3150 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

Correct Answer  $3276

Solution & Explanation

Solution

Given,

Principal (P) = $3150

Rate of Simple Interest (SI) = 2%

Time (t) = 2 years

Thus, Amount (A) = ?

The Rate of Interest is always calculated per annum, i.e. per year.

Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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) = $3150 × 2% × 2

= $3150 ײ/₁₀₀ × 2

= ^{3150 × 2 × 2}/₁₀₀

= ^{6300 × 2}/₁₀₀

= ¹²⁶⁰⁰/₁₀₀

= $126

Thus, Simple Interest = $126

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 = $3150 + $126

= $3276

Thus, Amount to be paid = $3276 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 = $3150

Rate of Simple Interest (SI) or (R) = 2%

And, Time (t) = 2 years

Thus, Amount (A)

= $3150 + ($3150 × 2% × 2)

= $3150 + ($3150 ײ/₁₀₀ × 2)

= $3150 + (^{3150 × 2 × 2}/₁₀₀)

= $3150 + (^{6300 × 2}/₁₀₀)

= $3150 + (¹²⁶⁰⁰/₁₀₀)

= $3150 + $126 = $3276

Thus, Amount (A) to be paid = $3276 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 2%

This, means, $2 per $100 per year

∵ For $100, the simple interest in 1 year = $2

∴ For $1, the simple interest in 1 year = ²/₁₀₀

∴ For $3150, the simple interest in 1 year

= ²/₁₀₀ × 3150

= ^{2 × 3150}/₁₀₀

= ⁶³⁰⁰/₁₀₀ = $63

Thus, simple interest in 1 year = $63

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $63 × 2 = $126

Thus, Simple Interest (SI) = $126

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3150 + $126

= $3276

Thus, Amount to be paid = $3276 Answer

Similar Questions

(1) Betty took a loan of $6500 at the rate of 10% simple interest per annum. If he paid an amount of $12350 to clear the loan, then find the time period of the loan.

(2) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $6560 to clear the loan, then find the time period of the loan.

(3) Find the amount to be paid if Thomas borrowed a sum of $5800 at 10% simple interest for 7 years.

(4) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $10164 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 4% simple interest.

(6) What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 3% simple interest?

(7) Find the amount to be paid if Richard borrowed a sum of $5600 at 4% simple interest for 7 years.

(8) Mark had to pay $4664 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(9) If Richard paid $4320 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(10) Lisa had to pay $4293 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.