Simple Interest
Math MCQs

Question :    What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 8% simple interest?

Correct Answer  $4234

Solution & Explanation

Solution

Given,

Principal (P) = $3650

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) = $3650 × 8% × 2

= $3650 ×⁸/₁₀₀ × 2

= ^{3650 × 8 × 2}/₁₀₀

= ^{29200 × 2}/₁₀₀

= ⁵⁸⁴⁰⁰/₁₀₀

= $584

Thus, Simple Interest = $584

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 = $3650 + $584

= $4234

Thus, Amount to be paid = $4234 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 = $3650

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3650 + ($3650 × 8% × 2)

= $3650 + ($3650 ×⁸/₁₀₀ × 2)

= $3650 + (^{3650 × 8 × 2}/₁₀₀)

= $3650 + (^{29200 × 2}/₁₀₀)

= $3650 + (⁵⁸⁴⁰⁰/₁₀₀)

= $3650 + $584 = $4234

Thus, Amount (A) to be paid = $4234 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 $3650, the simple interest in 1 year

= ⁸/₁₀₀ × 3650

= ^{8 × 3650}/₁₀₀

= ²⁹²⁰⁰/₁₀₀ = $292

Thus, simple interest for 1 year = $292

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $292 × 2 = $584

Thus, Simple Interest (SI) = $584

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3650 + $584

= $4234

Thus, Amount to be paid = $4234 Answer

Similar Questions

(1) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $11868 to clear the loan, then find the time period of the loan.

(2) Sarah took a loan of $5700 at the rate of 10% simple interest per annum. If he paid an amount of $9690 to clear the loan, then find the time period of the loan.

(3) Donna had to pay $5141 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(4) John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $6512 to clear the loan, then find the time period of the loan.

(5) Mary took a loan of $4100 at the rate of 8% simple interest per annum. If he paid an amount of $6068 to clear the loan, then find the time period of the loan.

(6) Find the amount to be paid if William borrowed a sum of $5500 at 5% simple interest for 8 years.

(7) In how much time a principal of $3050 will amount to $3660 at a simple interest of 5% per annum?

(8) How much loan did Linda borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5885 to clear it?

(9) Calculate the amount due after 10 years if Patricia borrowed a sum of $5150 at a rate of 9% simple interest.

(10) Find the amount to be paid if Thomas borrowed a sum of $5800 at 9% simple interest for 8 years.