Simple Interest
Math MCQs

Question :    Calculate the amount due if Joseph borrowed a sum of $3700 at 2% simple interest for 3 years.

Correct Answer  $3922

Solution & Explanation

Solution

Given,

Principal (P) = $3700

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) = $3700 × 2% × 3

= $3700 ײ/₁₀₀ × 3

= ^{3700 × 2 × 3}/₁₀₀

= ^{7400 × 3}/₁₀₀

= ²²²⁰⁰/₁₀₀

= $222

Thus, Simple Interest = $222

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 + $222

= $3922

Thus, Amount to be paid = $3922 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) = 2%

And, Time (t) = 3 years

Thus, Amount (A)

= $3700 + ($3700 × 2% × 3)

= $3700 + ($3700 ײ/₁₀₀ × 3)

= $3700 + (^{3700 × 2 × 3}/₁₀₀)

= $3700 + (^{7400 × 3}/₁₀₀)

= $3700 + (²²²⁰⁰/₁₀₀)

= $3700 + $222 = $3922

Thus, Amount (A) to be paid = $3922 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 $3700, the simple interest in 1 year

= ²/₁₀₀ × 3700

= ^{2 × 3700}/₁₀₀

= ⁷⁴⁰⁰/₁₀₀ = $74

Thus, simple interest for 1 year = $74

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $74 × 3 = $222

Thus, Simple Interest (SI) = $222

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3700 + $222

= $3922

Thus, Amount to be paid = $3922 Answer

Similar Questions

(1) Calculate the amount due if Patricia borrowed a sum of $3150 at 7% simple interest for 3 years.

(2) Mark had to pay $4928 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(3) Find the amount to be paid if Sarah borrowed a sum of $5850 at 10% simple interest for 8 years.

(4) Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $8960 to clear the loan, then find the time period of the loan.

(5) How much loan did Ashley borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7860 to clear it?

(6) Matthew took a loan of $6400 at the rate of 7% simple interest per annum. If he paid an amount of $10880 to clear the loan, then find the time period of the loan.

(7) Robert took a loan of $4200 at the rate of 6% simple interest per annum. If he paid an amount of $6468 to clear the loan, then find the time period of the loan.

(8) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 10% simple interest.

(9) Find the amount to be paid if Patricia borrowed a sum of $5150 at 3% simple interest for 7 years.

(10) How much loan did Steven borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7920 to clear it?