Simple Interest
Math MCQs

Question :    Calculate the amount due if Charles borrowed a sum of $3900 at 4% simple interest for 3 years.

Correct Answer  $4368

Solution & Explanation

Solution

Given,

Principal (P) = $3900

Rate of Simple Interest (SI) = 4%

Time (t) = 3 years

Thus, Amount (A) = ?

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

Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $3900 × 4% × 3

= $3900 ×⁴/₁₀₀ × 3

= ^{3900 × 4 × 3}/₁₀₀

= ^{15600 × 3}/₁₀₀

= ⁴⁶⁸⁰⁰/₁₀₀

= $468

Thus, Simple Interest = $468

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 = $3900 + $468

= $4368

Thus, Amount to be paid = $4368 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 = $3900

Rate of Simple Interest (SI) or (R) = 4%

And, Time (t) = 3 years

Thus, Amount (A)

= $3900 + ($3900 × 4% × 3)

= $3900 + ($3900 ×⁴/₁₀₀ × 3)

= $3900 + (^{3900 × 4 × 3}/₁₀₀)

= $3900 + (^{15600 × 3}/₁₀₀)

= $3900 + (⁴⁶⁸⁰⁰/₁₀₀)

= $3900 + $468 = $4368

Thus, Amount (A) to be paid = $4368 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 4%

This, means, $4 per $100 per year

∵ For $100, the simple interest for 1 year = $4

∴ For $1, the simple interest for 1 year = ⁴/₁₀₀

∴ For $3900, the simple interest in 1 year

= ⁴/₁₀₀ × 3900

= ^{4 × 3900}/₁₀₀

= ¹⁵⁶⁰⁰/₁₀₀ = $156

Thus, simple interest for 1 year = $156

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $156 × 3 = $468

Thus, Simple Interest (SI) = $468

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3900 + $468

= $4368

Thus, Amount to be paid = $4368 Answer

Similar Questions

(1) Ashley had to pay $4959.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(2) Sandra took a loan of $6900 at the rate of 9% simple interest per annum. If he paid an amount of $12489 to clear the loan, then find the time period of the loan.

(3) Calculate the amount due if Susan borrowed a sum of $3650 at 5% simple interest for 4 years.

(4) Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $10595 to clear the loan, then find the time period of the loan.

(5) How much loan did Deborah borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8940 to clear it?

(6) What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 8% simple interest?

(7) Find the amount to be paid if Charles borrowed a sum of $5900 at 10% simple interest for 8 years.

(8) Calculate the amount due after 9 years if Christopher borrowed a sum of $6000 at a rate of 7% simple interest.

(9) William took a loan of $5000 at the rate of 10% simple interest per annum. If he paid an amount of $8500 to clear the loan, then find the time period of the loan.

(10) Find the amount to be paid if James borrowed a sum of $5000 at 5% simple interest for 7 years.