Simple Interest
Math MCQs

Question :    What amount will be due after 2 years if James borrowed a sum of $3000 at a 8% simple interest?

Correct Answer  $3480

Solution & Explanation

Solution

Given,

Principal (P) = $3000

Rate of Simple Interest (SI) = 8%

Time (t) = 2 years

Thus, Amount (A) = ?

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

Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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) = $3000 × 8% × 2

= $3000 ×⁸/₁₀₀ × 2

= ^{3000 × 8 × 2}/₁₀₀

= ^{24000 × 2}/₁₀₀

= ⁴⁸⁰⁰⁰/₁₀₀

= $480

Thus, Simple Interest = $480

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 = $3000 + $480

= $3480

Thus, Amount to be paid = $3480 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 = $3000

Rate of Simple Interest (SI) or (R) = 8%

And, Time (t) = 2 years

Thus, Amount (A)

= $3000 + ($3000 × 8% × 2)

= $3000 + ($3000 ×⁸/₁₀₀ × 2)

= $3000 + (^{3000 × 8 × 2}/₁₀₀)

= $3000 + (^{24000 × 2}/₁₀₀)

= $3000 + (⁴⁸⁰⁰⁰/₁₀₀)

= $3000 + $480 = $3480

Thus, Amount (A) to be paid = $3480 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 8%

This, means, $8 per $100 per year

∵ For $100, the simple interest for 1 year = $8

∴ For $1, the simple interest for 1 year = ⁸/₁₀₀

∴ For $3000, the simple interest in 1 year

= ⁸/₁₀₀ × 3000

= ^{8 × 3000}/₁₀₀

= ²⁴⁰⁰⁰/₁₀₀ = $240

Thus, simple interest for 1 year = $240

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $240 × 2 = $480

Thus, Simple Interest (SI) = $480

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3000 + $480

= $3480

Thus, Amount to be paid = $3480 Answer

Similar Questions

(1) Matthew took a loan of $6400 at the rate of 8% simple interest per annum. If he paid an amount of $10496 to clear the loan, then find the time period of the loan.

(2) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 10% simple interest?

(3) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 10% simple interest.

(4) What amount will be due after 2 years if Mark borrowed a sum of $3700 at a 8% simple interest?

(5) Calculate the amount due if Barbara borrowed a sum of $3550 at 10% simple interest for 3 years.

(6) Robert took a loan of $4200 at the rate of 8% simple interest per annum. If he paid an amount of $6216 to clear the loan, then find the time period of the loan.

(7) If Michael paid $3828 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(8) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $7200 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 3% simple interest.

(10) Calculate the amount due if William borrowed a sum of $3500 at 9% simple interest for 3 years.