Simple Interest
Math MCQs

Question :    If Joseph borrowed $3700 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

Correct Answer  $3922

Solution & Explanation

Solution

Given,

Principal (P) = $3700

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) = $3700 × 3% × 2

= $3700 ׳/₁₀₀ × 2

= ^{3700 × 3 × 2}/₁₀₀

= ^{11100 × 2}/₁₀₀

= ²²²⁰⁰/₁₀₀

= $222

Thus, Simple Interest = $222

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 = $3700 + $222

= $3922

Thus, Amount to be paid = $3922 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 = $3700

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3700 + ($3700 × 3% × 2)

= $3700 + ($3700 ׳/₁₀₀ × 2)

= $3700 + (^{3700 × 3 × 2}/₁₀₀)

= $3700 + (^{11100 × 2}/₁₀₀)

= $3700 + (²²²⁰⁰/₁₀₀)

= $3700 + $222 = $3922

Thus, Amount (A) to be paid = $3922 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 $3700, the simple interest in 1 year

= ³/₁₀₀ × 3700

= ^{3 × 3700}/₁₀₀

= ¹¹¹⁰⁰/₁₀₀ = $111

Thus, simple interest for 1 year = $111

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $111 × 2 = $222

Thus, Simple Interest (SI) = $222

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3700 + $222

= $3922

Thus, Amount to be paid = $3922 Answer

Similar Questions

(1) If Barbara borrowed $3550 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(2) Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $7020 to clear the loan, then find the time period of the loan.

(3) If James paid $3480 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(4) Donald took a loan of $7000 at the rate of 8% simple interest per annum. If he paid an amount of $12040 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due if Sarah borrowed a sum of $3850 at 9% simple interest for 3 years.

(6) Margaret took a loan of $6700 at the rate of 10% simple interest per annum. If he paid an amount of $12730 to clear the loan, then find the time period of the loan.

(7) Find the amount to be paid if Joseph borrowed a sum of $5700 at 6% simple interest for 7 years.

(8) In how much time a principal of $3150 will amount to $3780 at a simple interest of 4% per annum?

(9) Calculate the amount due if Joseph borrowed a sum of $3700 at 10% simple interest for 4 years.

(10) Emily had to pay $5177.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.