Simple Interest
Math MCQs

Question :    What amount will be due after 2 years if Joshua borrowed a sum of $3950 at a 10% simple interest?

Correct Answer  $4740

Solution & Explanation

Solution

Given,

Principal (P) = $3950

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) = $3950 × 10% × 2

= $3950 ×¹⁰/₁₀₀ × 2

= ^{3950 × 10 × 2}/₁₀₀

= ^{39500 × 2}/₁₀₀

= ⁷⁹⁰⁰⁰/₁₀₀

= $790

Thus, Simple Interest = $790

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 = $3950 + $790

= $4740

Thus, Amount to be paid = $4740 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 = $3950

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

And, Time (t) = 2 years

Thus, Amount (A)

= $3950 + ($3950 × 10% × 2)

= $3950 + ($3950 ×¹⁰/₁₀₀ × 2)

= $3950 + (^{3950 × 10 × 2}/₁₀₀)

= $3950 + (^{39500 × 2}/₁₀₀)

= $3950 + (⁷⁹⁰⁰⁰/₁₀₀)

= $3950 + $790 = $4740

Thus, Amount (A) to be paid = $4740 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 $3950, the simple interest in 1 year

= ¹⁰/₁₀₀ × 3950

= ^{10 × 3950}/₁₀₀

= ³⁹⁵⁰⁰/₁₀₀ = $395

Thus, simple interest for 1 year = $395

Therefore, simple interest for 2 years

= Simple interest for 1 year × 2

= $395 × 2 = $790

Thus, Simple Interest (SI) = $790

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3950 + $790

= $4740

Thus, Amount to be paid = $4740 Answer

Similar Questions

(1) Find the amount to be paid if Karen borrowed a sum of $5950 at 5% simple interest for 8 years.

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

(3) Joseph took a loan of $5400 at the rate of 8% simple interest per annum. If he paid an amount of $8856 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due if Barbara borrowed a sum of $3550 at 9% simple interest for 3 years.

(5) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $7560 to clear the loan, then find the time period of the loan.

(6) Calculate the amount due if William borrowed a sum of $3500 at 4% simple interest for 3 years.

(7) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 7% simple interest.

(8) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 9% simple interest.

(9) Find the amount to be paid if Richard borrowed a sum of $5600 at 2% simple interest for 7 years.

(10) Calculate the amount due if David borrowed a sum of $3400 at 8% simple interest for 4 years.