Simple Interest
Math MCQs

Question :    If Mary borrowed $3050 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

Correct Answer  $3233

Solution & Explanation

Solution

Given,

Principal (P) = $3050

Rate of Simple Interest (SI) = 3%

Time (t) = 2 years

Thus, Amount (A) = ?

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

Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $3050 × 3% × 2

= $3050 ׳/₁₀₀ × 2

= ^{3050 × 3 × 2}/₁₀₀

= ^{9150 × 2}/₁₀₀

= ¹⁸³⁰⁰/₁₀₀

= $183

Thus, Simple Interest = $183

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 = $3050 + $183

= $3233

Thus, Amount to be paid = $3233 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 = $3050

Rate of Simple Interest (SI) or (R) = 3%

And, Time (t) = 2 years

Thus, Amount (A)

= $3050 + ($3050 × 3% × 2)

= $3050 + ($3050 ׳/₁₀₀ × 2)

= $3050 + (^{3050 × 3 × 2}/₁₀₀)

= $3050 + (^{9150 × 2}/₁₀₀)

= $3050 + (¹⁸³⁰⁰/₁₀₀)

= $3050 + $183 = $3233

Thus, Amount (A) to be paid = $3233 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 3%

This, means, $3 per $100 per year

∵ For $100, the simple interest for 1 year = $3

∴ For $1, the simple interest for 1 year = ³/₁₀₀

∴ For $3050, the simple interest in 1 year

= ³/₁₀₀ × 3050

= ^{3 × 3050}/₁₀₀

= ⁹¹⁵⁰/₁₀₀ = $91.5

Thus, simple interest for 1 year = $91.5

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $91.5 × 2 = $183

Thus, Simple Interest (SI) = $183

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3050 + $183

= $3233

Thus, Amount to be paid = $3233 Answer

Similar Questions

(1) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 9% simple interest?

(2) William took a loan of $5000 at the rate of 8% simple interest per annum. If he paid an amount of $7400 to clear the loan, then find the time period of the loan.

(3) What amount does Jessica have to pay after 5 years if he takes a loan of $3750 at 3% simple interest?

(4) If Andrew paid $5568 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(5) Find the amount to be paid if Patricia borrowed a sum of $5150 at 2% simple interest for 8 years.

(6) Calculate the amount due if Sarah borrowed a sum of $3850 at 2% simple interest for 3 years.

(7) How much loan did Kevin borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7810 to clear it?

(8) Find the amount to be paid if Thomas borrowed a sum of $5800 at 2% simple interest for 7 years.

(9) How much loan did Rebecca borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8415 to clear it?

(10) How much loan did Stephanie borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8305 to clear it?