Simple Interest
Math MCQs

Question :    What amount will be due after 2 years if Paul borrowed a sum of $3850 at a 6% simple interest?

Correct Answer  $4312

Solution & Explanation

Solution

Given,

Principal (P) = $3850

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) = $3850 × 6% × 2

= $3850 ×⁶/₁₀₀ × 2

= ^{3850 × 6 × 2}/₁₀₀

= ^{23100 × 2}/₁₀₀

= ⁴⁶²⁰⁰/₁₀₀

= $462

Thus, Simple Interest = $462

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 = $3850 + $462

= $4312

Thus, Amount to be paid = $4312 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 = $3850

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3850 + ($3850 × 6% × 2)

= $3850 + ($3850 ×⁶/₁₀₀ × 2)

= $3850 + (^{3850 × 6 × 2}/₁₀₀)

= $3850 + (^{23100 × 2}/₁₀₀)

= $3850 + (⁴⁶²⁰⁰/₁₀₀)

= $3850 + $462 = $4312

Thus, Amount (A) to be paid = $4312 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 $3850, the simple interest in 1 year

= ⁶/₁₀₀ × 3850

= ^{6 × 3850}/₁₀₀

= ²³¹⁰⁰/₁₀₀ = $231

Thus, simple interest for 1 year = $231

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $231 × 2 = $462

Thus, Simple Interest (SI) = $462

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3850 + $462

= $4312

Thus, Amount to be paid = $4312 Answer

Similar Questions

(1) Calculate the amount due if Robert borrowed a sum of $3100 at 10% simple interest for 4 years.

(2) John had to pay $3392 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(3) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 7% simple interest.

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

(5) How much loan did Sarah borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7312.5 to clear it?

(6) Find the amount to be paid if Patricia borrowed a sum of $5150 at 4% simple interest for 8 years.

(7) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 3% simple interest?

(8) Calculate the amount due if Christopher borrowed a sum of $4000 at 5% simple interest for 4 years.

(9) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $10988 to clear the loan, then find the time period of the loan.

(10) Calculate the amount due if Patricia borrowed a sum of $3150 at 7% simple interest for 4 years.