Simple Interest
Math MCQs

Question :    Calculate the amount due if David borrowed a sum of $3400 at 2% simple interest for 3 years.

Correct Answer  $3604

Solution & Explanation

Solution

Given,

Principal (P) = $3400

Rate of Simple Interest (SI) = 2%

Time (t) = 3 years

Thus, Amount (A) = ?

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

Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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 × 2% × 3

= $3400 ײ/₁₀₀ × 3

= ^{3400 × 2 × 3}/₁₀₀

= ^{6800 × 3}/₁₀₀

= ²⁰⁴⁰⁰/₁₀₀

= $204

Thus, Simple Interest = $204

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 + $204

= $3604

Thus, Amount to be paid = $3604 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) = 2%

And, Time (t) = 3 years

Thus, Amount (A)

= $3400 + ($3400 × 2% × 3)

= $3400 + ($3400 ײ/₁₀₀ × 3)

= $3400 + (^{3400 × 2 × 3}/₁₀₀)

= $3400 + (^{6800 × 3}/₁₀₀)

= $3400 + (²⁰⁴⁰⁰/₁₀₀)

= $3400 + $204 = $3604

Thus, Amount (A) to be paid = $3604 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 2%

This, means, $2 per $100 per year

∵ For $100, the simple interest for 1 year = $2

∴ For $1, the simple interest for 1 year = ²/₁₀₀

∴ For $3400, the simple interest in 1 year

= ²/₁₀₀ × 3400

= ^{2 × 3400}/₁₀₀

= ⁶⁸⁰⁰/₁₀₀ = $68

Thus, simple interest for 1 year = $68

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $68 × 3 = $204

Thus, Simple Interest (SI) = $204

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3400 + $204

= $3604

Thus, Amount to be paid = $3604 Answer

Similar Questions

(1) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $10106 to clear the loan, then find the time period of the loan.

(2) Calculate the amount due if Charles borrowed a sum of $3900 at 8% simple interest for 3 years.

(3) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $7824 to clear the loan, then find the time period of the loan.

(4) Jennifer had to pay $3542.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(5) Find the amount to be paid if William borrowed a sum of $5500 at 7% simple interest for 8 years.

(6) Jessica took a loan of $5500 at the rate of 10% simple interest per annum. If he paid an amount of $9350 to clear the loan, then find the time period of the loan.

(7) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 5% simple interest?

(8) How much loan did David borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5940 to clear it?

(9) Donald took a loan of $7000 at the rate of 8% simple interest per annum. If he paid an amount of $11480 to clear the loan, then find the time period of the loan.

(10) Patricia took a loan of $4300 at the rate of 10% simple interest per annum. If he paid an amount of $8170 to clear the loan, then find the time period of the loan.