Simple Interest
Math MCQs

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

Correct Answer  $4292

Solution & Explanation

Solution

Given,

Principal (P) = $3700

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) = $3700 × 8% × 2

= $3700 ×⁸/₁₀₀ × 2

= ^{3700 × 8 × 2}/₁₀₀

= ^{29600 × 2}/₁₀₀

= ⁵⁹²⁰⁰/₁₀₀

= $592

Thus, Simple Interest = $592

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 = $3700 + $592

= $4292

Thus, Amount to be paid = $4292 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 = $3700

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3700 + ($3700 × 8% × 2)

= $3700 + ($3700 ×⁸/₁₀₀ × 2)

= $3700 + (^{3700 × 8 × 2}/₁₀₀)

= $3700 + (^{29600 × 2}/₁₀₀)

= $3700 + (⁵⁹²⁰⁰/₁₀₀)

= $3700 + $592 = $4292

Thus, Amount (A) to be paid = $4292 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 $3700, the simple interest in 1 year

= ⁸/₁₀₀ × 3700

= ^{8 × 3700}/₁₀₀

= ²⁹⁶⁰⁰/₁₀₀ = $296

Thus, simple interest for 1 year = $296

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $296 × 2 = $592

Thus, Simple Interest (SI) = $592

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3700 + $592

= $4292

Thus, Amount to be paid = $4292 Answer

Similar Questions

(1) Find the amount to be paid if Charles borrowed a sum of $5900 at 8% simple interest for 8 years.

(2) Find the amount to be paid if Christopher borrowed a sum of $6000 at 5% simple interest for 7 years.

(3) Find the amount to be paid if James borrowed a sum of $5000 at 3% simple interest for 8 years.

(4) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 2% simple interest.

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

(6) Calculate the amount due if Joseph borrowed a sum of $3700 at 10% simple interest for 4 years.

(7) If Kimberly paid $5208 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(8) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 5% simple interest.

(9) Find the amount to be paid if Karen borrowed a sum of $5950 at 6% simple interest for 8 years.

(10) Calculate the amount due if William borrowed a sum of $3500 at 4% simple interest for 4 years.