Simple Interest
Math MCQs

Question :    If Charles borrowed $3900 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

Correct Answer  $4134

Solution & Explanation

Solution

Given,

Principal (P) = $3900

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) = $3900 × 3% × 2

= $3900 ׳/₁₀₀ × 2

= ^{3900 × 3 × 2}/₁₀₀

= ^{11700 × 2}/₁₀₀

= ²³⁴⁰⁰/₁₀₀

= $234

Thus, Simple Interest = $234

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 = $3900 + $234

= $4134

Thus, Amount to be paid = $4134 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 = $3900

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3900 + ($3900 × 3% × 2)

= $3900 + ($3900 ׳/₁₀₀ × 2)

= $3900 + (^{3900 × 3 × 2}/₁₀₀)

= $3900 + (^{11700 × 2}/₁₀₀)

= $3900 + (²³⁴⁰⁰/₁₀₀)

= $3900 + $234 = $4134

Thus, Amount (A) to be paid = $4134 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 $3900, the simple interest in 1 year

= ³/₁₀₀ × 3900

= ^{3 × 3900}/₁₀₀

= ¹¹⁷⁰⁰/₁₀₀ = $117

Thus, simple interest for 1 year = $117

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $117 × 2 = $234

Thus, Simple Interest (SI) = $234

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3900 + $234

= $4134

Thus, Amount to be paid = $4134 Answer

Similar Questions

(1) Find the amount to be paid if Patricia borrowed a sum of $5150 at 3% simple interest for 7 years.

(2) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $8480 to clear the loan, then find the time period of the loan.

(3) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 6% simple interest?

(4) If Donald paid $5220 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(5) In how much time a principal of $3000 will amount to $3450 at a simple interest of 5% per annum?

(6) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 7% simple interest?

(7) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 6% simple interest?

(8) If Betty paid $4930 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(9) Find the amount to be paid if Barbara borrowed a sum of $5550 at 4% simple interest for 7 years.

(10) If Karen paid $4266 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.