Simple Interest
Math MCQs

Question :    Calculate the amount due if Elizabeth borrowed a sum of $3450 at 6% simple interest for 3 years.

Correct Answer  $4071

Solution & Explanation

Solution

Given,

Principal (P) = $3450

Rate of Simple Interest (SI) = 6%

Time (t) = 3 years

Thus, Amount (A) = ?

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

Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $3450 × 6% × 3

= $3450 ×⁶/₁₀₀ × 3

= ^{3450 × 6 × 3}/₁₀₀

= ^{20700 × 3}/₁₀₀

= ⁶²¹⁰⁰/₁₀₀

= $621

Thus, Simple Interest = $621

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 = $3450 + $621

= $4071

Thus, Amount to be paid = $4071 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 = $3450

Rate of Simple Interest (SI) or (R) = 6%

And, Time (t) = 3 years

Thus, Amount (A)

= $3450 + ($3450 × 6% × 3)

= $3450 + ($3450 ×⁶/₁₀₀ × 3)

= $3450 + (^{3450 × 6 × 3}/₁₀₀)

= $3450 + (^{20700 × 3}/₁₀₀)

= $3450 + (⁶²¹⁰⁰/₁₀₀)

= $3450 + $621 = $4071

Thus, Amount (A) to be paid = $4071 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 6%

This, means, $6 per $100 per year

∵ For $100, the simple interest for 1 year = $6

∴ For $1, the simple interest for 1 year = ⁶/₁₀₀

∴ For $3450, the simple interest in 1 year

= ⁶/₁₀₀ × 3450

= ^{6 × 3450}/₁₀₀

= ²⁰⁷⁰⁰/₁₀₀ = $207

Thus, simple interest for 1 year = $207

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $207 × 3 = $621

Thus, Simple Interest (SI) = $621

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3450 + $621

= $4071

Thus, Amount to be paid = $4071 Answer

Similar Questions

(1) If Mary borrowed $3050 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(2) Find the amount to be paid if Sarah borrowed a sum of $5850 at 7% simple interest for 8 years.

(3) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $7740 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 6% simple interest.

(5) Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $8800 to clear the loan, then find the time period of the loan.

(6) How much loan did Jason borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9240 to clear it?

(7) If Susan paid $4380 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(8) Charles had to pay $4485 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(9) How much loan did Laura borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9812.5 to clear it?

(10) What amount does James have to pay after 6 years if he takes a loan of $3000 at 8% simple interest?