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) Calculate the amount due after 9 years if Charles borrowed a sum of $5900 at a rate of 8% simple interest.

(2) If Jessica paid $4050 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(3) Patricia took a loan of $4300 at the rate of 9% simple interest per annum. If he paid an amount of $8170 to clear the loan, then find the time period of the loan.

(4) Joseph took a loan of $5400 at the rate of 6% simple interest per annum. If he paid an amount of $7992 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due if Karen borrowed a sum of $3950 at 3% simple interest for 3 years.

(6) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $8976 to clear the loan, then find the time period of the loan.

(7) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 2% simple interest.

(8) How much loan did Joshua borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8625 to clear it?

(9) What amount will be due after 2 years if Charles borrowed a sum of $3450 at a 7% simple interest?

(10) How much loan did Donald borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8125 to clear it?