Simple Interest
Math MCQs

Question :    What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 6% simple interest?

Correct Answer  $3976

Solution & Explanation

Solution

Given,

Principal (P) = $3550

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) = $3550 × 6% × 2

= $3550 ×⁶/₁₀₀ × 2

= ^{3550 × 6 × 2}/₁₀₀

= ^{21300 × 2}/₁₀₀

= ⁴²⁶⁰⁰/₁₀₀

= $426

Thus, Simple Interest = $426

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 = $3550 + $426

= $3976

Thus, Amount to be paid = $3976 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 = $3550

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3550 + ($3550 × 6% × 2)

= $3550 + ($3550 ×⁶/₁₀₀ × 2)

= $3550 + (^{3550 × 6 × 2}/₁₀₀)

= $3550 + (^{21300 × 2}/₁₀₀)

= $3550 + (⁴²⁶⁰⁰/₁₀₀)

= $3550 + $426 = $3976

Thus, Amount (A) to be paid = $3976 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 $3550, the simple interest in 1 year

= ⁶/₁₀₀ × 3550

= ^{6 × 3550}/₁₀₀

= ²¹³⁰⁰/₁₀₀ = $213

Thus, simple interest for 1 year = $213

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $213 × 2 = $426

Thus, Simple Interest (SI) = $426

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3550 + $426

= $3976

Thus, Amount to be paid = $3976 Answer

Similar Questions

(1) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 9% simple interest?

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

(3) Calculate the amount due if Jessica borrowed a sum of $3750 at 5% simple interest for 4 years.

(4) 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.

(5) How much loan did Christopher borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7200 to clear it?

(6) Calculate the amount due if Thomas borrowed a sum of $3800 at 5% simple interest for 4 years.

(7) Susan took a loan of $5300 at the rate of 8% simple interest per annum. If he paid an amount of $8692 to clear the loan, then find the time period of the loan.

(8) If Mark paid $4752 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(9) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 8% simple interest for 7 years.

(10) How much loan did Timothy borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8880 to clear it?