Simple Interest
Math MCQs

Question :    If Thomas borrowed $3800 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

Correct Answer  $4028

Solution & Explanation

Solution

Given,

Principal (P) = $3800

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) = $3800 × 3% × 2

= $3800 ׳/₁₀₀ × 2

= ^{3800 × 3 × 2}/₁₀₀

= ^{11400 × 2}/₁₀₀

= ²²⁸⁰⁰/₁₀₀

= $228

Thus, Simple Interest = $228

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 = $3800 + $228

= $4028

Thus, Amount to be paid = $4028 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 = $3800

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3800 + ($3800 × 3% × 2)

= $3800 + ($3800 ׳/₁₀₀ × 2)

= $3800 + (^{3800 × 3 × 2}/₁₀₀)

= $3800 + (^{11400 × 2}/₁₀₀)

= $3800 + (²²⁸⁰⁰/₁₀₀)

= $3800 + $228 = $4028

Thus, Amount (A) to be paid = $4028 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 $3800, the simple interest in 1 year

= ³/₁₀₀ × 3800

= ^{3 × 3800}/₁₀₀

= ¹¹⁴⁰⁰/₁₀₀ = $114

Thus, simple interest for 1 year = $114

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $114 × 2 = $228

Thus, Simple Interest (SI) = $228

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3800 + $228

= $4028

Thus, Amount to be paid = $4028 Answer

Similar Questions

(1) Calculate the amount due if Barbara borrowed a sum of $3550 at 8% simple interest for 3 years.

(2) Jennifer took a loan of $4500 at the rate of 9% simple interest per annum. If he paid an amount of $8145 to clear the loan, then find the time period of the loan.

(3) In how much time a principal of $3000 will amount to $3450 at a simple interest of 3% per annum?

(4) If Barbara paid $3976 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(5) Calculate the amount due if Susan borrowed a sum of $3650 at 6% simple interest for 4 years.

(6) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 5% simple interest.

(7) Calculate the amount due if Sarah borrowed a sum of $3850 at 5% simple interest for 4 years.

(8) Calculate the amount due if Patricia borrowed a sum of $3150 at 6% simple interest for 4 years.

(9) Find the amount to be paid if Richard borrowed a sum of $5600 at 4% simple interest for 8 years.

(10) Donald took a loan of $7000 at the rate of 7% simple interest per annum. If he paid an amount of $11900 to clear the loan, then find the time period of the loan.