Simple Interest
Math MCQs

Question :    Calculate the amount due if David borrowed a sum of $3400 at 7% simple interest for 3 years.

Correct Answer  $4114

Solution & Explanation

Solution

Given,

Principal (P) = $3400

Rate of Simple Interest (SI) = 7%

Time (t) = 3 years

Thus, Amount (A) = ?

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

Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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 × 7% × 3

= $3400 ×⁷/₁₀₀ × 3

= ^{3400 × 7 × 3}/₁₀₀

= ^{23800 × 3}/₁₀₀

= ⁷¹⁴⁰⁰/₁₀₀

= $714

Thus, Simple Interest = $714

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 + $714

= $4114

Thus, Amount to be paid = $4114 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) = 7%

And, Time (t) = 3 years

Thus, Amount (A)

= $3400 + ($3400 × 7% × 3)

= $3400 + ($3400 ×⁷/₁₀₀ × 3)

= $3400 + (^{3400 × 7 × 3}/₁₀₀)

= $3400 + (^{23800 × 3}/₁₀₀)

= $3400 + (⁷¹⁴⁰⁰/₁₀₀)

= $3400 + $714 = $4114

Thus, Amount (A) to be paid = $4114 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 7%

This, means, $7 per $100 per year

∵ For $100, the simple interest for 1 year = $7

∴ For $1, the simple interest for 1 year = ⁷/₁₀₀

∴ For $3400, the simple interest in 1 year

= ⁷/₁₀₀ × 3400

= ^{7 × 3400}/₁₀₀

= ²³⁸⁰⁰/₁₀₀ = $238

Thus, simple interest for 1 year = $238

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $238 × 3 = $714

Thus, Simple Interest (SI) = $714

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3400 + $714

= $4114

Thus, Amount to be paid = $4114 Answer

Similar Questions

(1) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $9010 to clear the loan, then find the time period of the loan.

(2) Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 9% simple interest.

(3) Charles took a loan of $5800 at the rate of 8% simple interest per annum. If he paid an amount of $9048 to clear the loan, then find the time period of the loan.

(4) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 10% simple interest?

(5) Linda took a loan of $4700 at the rate of 10% simple interest per annum. If he paid an amount of $7520 to clear the loan, then find the time period of the loan.

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

(7) Find the amount to be paid if Thomas borrowed a sum of $5800 at 8% simple interest for 7 years.

(8) Calculate the amount due if Charles borrowed a sum of $3900 at 10% simple interest for 4 years.

(9) If Joshua paid $5488 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(10) Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $9520 to clear the loan, then find the time period of the loan.