Simple Interest
Math MCQs

Question :    What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 6% simple interest?

Correct Answer  $3528

Solution & Explanation

Solution

Given,

Principal (P) = $3150

Rate of Simple Interest (SI) = 6%

Time (t) = 2 years

Thus, Amount (A) = ?

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

Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $3150 × 6% × 2

= $3150 ×⁶/₁₀₀ × 2

= ^{3150 × 6 × 2}/₁₀₀

= ^{18900 × 2}/₁₀₀

= ³⁷⁸⁰⁰/₁₀₀

= $378

Thus, Simple Interest = $378

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 = $3150 + $378

= $3528

Thus, Amount to be paid = $3528 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 = $3150

Rate of Simple Interest (SI) or (R) = 6%

And, Time (t) = 2 years

Thus, Amount (A)

= $3150 + ($3150 × 6% × 2)

= $3150 + ($3150 ×⁶/₁₀₀ × 2)

= $3150 + (^{3150 × 6 × 2}/₁₀₀)

= $3150 + (^{18900 × 2}/₁₀₀)

= $3150 + (³⁷⁸⁰⁰/₁₀₀)

= $3150 + $378 = $3528

Thus, Amount (A) to be paid = $3528 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 6%

This, means, $6 per $100 per year

∵ For $100, the simple interest for 1 year = $6

∴ For $1, the simple interest for 1 year = ⁶/₁₀₀

∴ For $3150, the simple interest in 1 year

= ⁶/₁₀₀ × 3150

= ^{6 × 3150}/₁₀₀

= ¹⁸⁹⁰⁰/₁₀₀ = $189

Thus, simple interest for 1 year = $189

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $189 × 2 = $378

Thus, Simple Interest (SI) = $378

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3150 + $378

= $3528

Thus, Amount to be paid = $3528 Answer

Similar Questions

(1) Patricia took a loan of $4300 at the rate of 7% simple interest per annum. If he paid an amount of $6708 to clear the loan, then find the time period of the loan.

(2) How much loan did Melissa borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8085 to clear it?

(3) Susan took a loan of $5300 at the rate of 6% simple interest per annum. If he paid an amount of $7526 to clear the loan, then find the time period of the loan.

(4) What amount does John have to pay after 6 years if he takes a loan of $3200 at 10% simple interest?

(5) Joshua had to pay $5194 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(6) Find the amount to be paid if Karen borrowed a sum of $5950 at 3% simple interest for 7 years.

(7) Lisa had to pay $4414.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(8) Calculate the amount due after 9 years if David borrowed a sum of $5400 at a rate of 7% simple interest.

(9) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $7740 to clear the loan, then find the time period of the loan.

(10) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $9514 to clear the loan, then find the time period of the loan.