Simple Interest
Math MCQs

Question :    If Michael borrowed $3300 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

Correct Answer  $3498

Solution & Explanation

Solution

Given,

Principal (P) = $3300

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) = $3300 × 3% × 2

= $3300 ׳/₁₀₀ × 2

= ^{3300 × 3 × 2}/₁₀₀

= ^{9900 × 2}/₁₀₀

= ¹⁹⁸⁰⁰/₁₀₀

= $198

Thus, Simple Interest = $198

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 = $3300 + $198

= $3498

Thus, Amount to be paid = $3498 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 = $3300

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3300 + ($3300 × 3% × 2)

= $3300 + ($3300 ׳/₁₀₀ × 2)

= $3300 + (^{3300 × 3 × 2}/₁₀₀)

= $3300 + (^{9900 × 2}/₁₀₀)

= $3300 + (¹⁹⁸⁰⁰/₁₀₀)

= $3300 + $198 = $3498

Thus, Amount (A) to be paid = $3498 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 $3300, the simple interest in 1 year

= ³/₁₀₀ × 3300

= ^{3 × 3300}/₁₀₀

= ⁹⁹⁰⁰/₁₀₀ = $99

Thus, simple interest for 1 year = $99

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $99 × 2 = $198

Thus, Simple Interest (SI) = $198

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3300 + $198

= $3498

Thus, Amount to be paid = $3498 Answer

Similar Questions

(1) How much loan did Charles borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6490 to clear it?

(2) Anthony took a loan of $6600 at the rate of 8% simple interest per annum. If he paid an amount of $11352 to clear the loan, then find the time period of the loan.

(3) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 5% simple interest.

(4) Calculate the amount due if Patricia borrowed a sum of $3150 at 2% simple interest for 4 years.

(5) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 4% simple interest?

(6) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 5% simple interest for 8 years.

(7) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $9180 to clear the loan, then find the time period of the loan.

(8) Calculate the amount due if Joseph borrowed a sum of $3700 at 3% simple interest for 3 years.

(9) If Betty paid $5100 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(10) How much loan did Melissa borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8820 to clear it?