Simple Interest
Math MCQs

Question :    Calculate the amount due if Karen borrowed a sum of $3950 at 6% simple interest for 3 years.

Correct Answer  $4661

Solution & Explanation

Solution

Given,

Principal (P) = $3950

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) = $3950 × 6% × 3

= $3950 ×⁶/₁₀₀ × 3

= ^{3950 × 6 × 3}/₁₀₀

= ^{23700 × 3}/₁₀₀

= ⁷¹¹⁰⁰/₁₀₀

= $711

Thus, Simple Interest = $711

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 + $711

= $4661

Thus, Amount to be paid = $4661 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) = 6%

And, Time (t) = 3 years

Thus, Amount (A)

= $3950 + ($3950 × 6% × 3)

= $3950 + ($3950 ×⁶/₁₀₀ × 3)

= $3950 + (^{3950 × 6 × 3}/₁₀₀)

= $3950 + (^{23700 × 3}/₁₀₀)

= $3950 + (⁷¹¹⁰⁰/₁₀₀)

= $3950 + $711 = $4661

Thus, Amount (A) to be paid = $4661 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 $3950, the simple interest in 1 year

= ⁶/₁₀₀ × 3950

= ^{6 × 3950}/₁₀₀

= ²³⁷⁰⁰/₁₀₀ = $237

Thus, simple interest for 1 year = $237

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $237 × 3 = $711

Thus, Simple Interest (SI) = $711

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3950 + $711

= $4661

Thus, Amount to be paid = $4661 Answer

Similar Questions

(1) How much loan did Carol borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7755 to clear it?

(2) Calculate the amount due if Joseph borrowed a sum of $3700 at 3% simple interest for 4 years.

(3) Find the amount to be paid if Robert borrowed a sum of $5100 at 3% simple interest for 8 years.

(4) Joseph took a loan of $5400 at the rate of 7% simple interest per annum. If he paid an amount of $8046 to clear the loan, then find the time period of the loan.

(5) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 6% simple interest?

(6) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 10% simple interest?

(7) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 3% simple interest.

(8) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 9% simple interest for 8 years.

(9) Christopher took a loan of $6000 at the rate of 8% simple interest per annum. If he paid an amount of $8880 to clear the loan, then find the time period of the loan.

(10) Elizabeth took a loan of $4900 at the rate of 10% simple interest per annum. If he paid an amount of $7840 to clear the loan, then find the time period of the loan.