Simple Interest
Math MCQs

Question :    What amount will be due after 2 years if Thomas borrowed a sum of $3400 at a 10% simple interest?

Correct Answer  $4080

Solution & Explanation

Solution

Given,

Principal (P) = $3400

Rate of Simple Interest (SI) = 10%

Time (t) = 2 years

Thus, Amount (A) = ?

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

Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $3400 × 10% × 2

= $3400 ×¹⁰/₁₀₀ × 2

= ^{3400 × 10 × 2}/₁₀₀

= ^{34000 × 2}/₁₀₀

= ⁶⁸⁰⁰⁰/₁₀₀

= $680

Thus, Simple Interest = $680

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 = $3400 + $680

= $4080

Thus, Amount to be paid = $4080 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 = $3400

Rate of Simple Interest (SI) or (R) = 10%

And, Time (t) = 2 years

Thus, Amount (A)

= $3400 + ($3400 × 10% × 2)

= $3400 + ($3400 ×¹⁰/₁₀₀ × 2)

= $3400 + (^{3400 × 10 × 2}/₁₀₀)

= $3400 + (^{34000 × 2}/₁₀₀)

= $3400 + (⁶⁸⁰⁰⁰/₁₀₀)

= $3400 + $680 = $4080

Thus, Amount (A) to be paid = $4080 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 10%

This, means, $10 per $100 per year

∵ For $100, the simple interest for 1 year = $10

∴ For $1, the simple interest for 1 year = ¹⁰/₁₀₀

∴ For $3400, the simple interest in 1 year

= ¹⁰/₁₀₀ × 3400

= ^{10 × 3400}/₁₀₀

= ³⁴⁰⁰⁰/₁₀₀ = $340

Thus, simple interest for 1 year = $340

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $340 × 2 = $680

Thus, Simple Interest (SI) = $680

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3400 + $680

= $4080

Thus, Amount to be paid = $4080 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 $11316 to clear the loan, then find the time period of the loan.

(2) How much loan did Jason borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9625 to clear it?

(3) Find the amount to be paid if Linda borrowed a sum of $5350 at 2% simple interest for 8 years.

(4) What amount does Karen have to pay after 5 years if he takes a loan of $3950 at 4% simple interest?

(5) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $9983 to clear the loan, then find the time period of the loan.

(6) Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $10281 to clear the loan, then find the time period of the loan.

(7) Calculate the amount due if Michael borrowed a sum of $3300 at 6% simple interest for 4 years.

(8) What amount does John have to pay after 6 years if he takes a loan of $3200 at 10% simple interest?

(9) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 5% simple interest?

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