Simple Interest
Math MCQs

Question :  ( 1 of 10 )  What amount will be due after 2 years if Thomas borrowed a sum of $3400 at a 4% simple interest?

Correct Answer  $3672

Solution & Explanation

Solution

Given,

Principal (P) = $3400

Rate of Simple Interest (SI) = 4%

Time (t) = 2 years

Thus, Amount (A) = ?

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

Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $3400 × 4% × 2

= $3400 ×⁴/₁₀₀ × 2

= ^{3400 × 4 × 2}/₁₀₀

= ^{13600 × 2}/₁₀₀

= ²⁷²⁰⁰/₁₀₀

= $272

Thus, Simple Interest = $272

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 = $3400 + $272

= $3672

Thus, Amount to be paid = $3672 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 = $3400

Rate of Simple Interest (SI) or (R) = 4%

And, Time (t) = 2 years

Thus, Amount (A)

= $3400 + ($3400 × 4% × 2)

= $3400 + ($3400 ×⁴/₁₀₀ × 2)

= $3400 + (^{3400 × 4 × 2}/₁₀₀)

= $3400 + (^{13600 × 2}/₁₀₀)

= $3400 + (²⁷²⁰⁰/₁₀₀)

= $3400 + $272 = $3672

Thus, Amount (A) to be paid = $3672 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 4%

This, means, $4 per $100 per year

∵ For $100, the simple interest for 1 year = $4

∴ For $1, the simple interest for 1 year = ⁴/₁₀₀

∴ For $3400, the simple interest in 1 year

= ⁴/₁₀₀ × 3400

= ^{4 × 3400}/₁₀₀

= ¹³⁶⁰⁰/₁₀₀ = $136

Thus, simple interest for 1 year = $136

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $136 × 2 = $272

Thus, Simple Interest (SI) = $272

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3400 + $272

= $3672

Thus, Amount to be paid = $3672 Answer

Similar Questions

(1) Calculate the amount due if Richard borrowed a sum of $3600 at 2% simple interest for 3 years.

(2) What amount does Christopher have to pay after 5 years if he takes a loan of $4000 at 8% simple interest?

(3) Calculate the amount due if Christopher borrowed a sum of $4000 at 4% simple interest for 4 years.

(4) Anthony took a loan of $6600 at the rate of 9% simple interest per annum. If he paid an amount of $11946 to clear the loan, then find the time period of the loan.

(5) Find the amount to be paid if Patricia borrowed a sum of $5150 at 4% simple interest for 7 years.

(6) Lisa took a loan of $6100 at the rate of 8% simple interest per annum. If he paid an amount of $10492 to clear the loan, then find the time period of the loan.

(7) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 2% simple interest.

(8) Mary took a loan of $4100 at the rate of 8% simple interest per annum. If he paid an amount of $7380 to clear the loan, then find the time period of the loan.

(9) Jessica took a loan of $5500 at the rate of 7% simple interest per annum. If he paid an amount of $9350 to clear the loan, then find the time period of the loan.

(10) How much loan did Karen borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6545 to clear it?