Simple Interest
Math MCQs

Question :    Calculate the amount due if Charles borrowed a sum of $3900 at 7% simple interest for 3 years.

Correct Answer  $4719

Solution & Explanation

Solution

Given,

Principal (P) = $3900

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) = $3900 × 7% × 3

= $3900 ×⁷/₁₀₀ × 3

= ^{3900 × 7 × 3}/₁₀₀

= ^{27300 × 3}/₁₀₀

= ⁸¹⁹⁰⁰/₁₀₀

= $819

Thus, Simple Interest = $819

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 + $819

= $4719

Thus, Amount to be paid = $4719 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) = 7%

And, Time (t) = 3 years

Thus, Amount (A)

= $3900 + ($3900 × 7% × 3)

= $3900 + ($3900 ×⁷/₁₀₀ × 3)

= $3900 + (^{3900 × 7 × 3}/₁₀₀)

= $3900 + (^{27300 × 3}/₁₀₀)

= $3900 + (⁸¹⁹⁰⁰/₁₀₀)

= $3900 + $819 = $4719

Thus, Amount (A) to be paid = $4719 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 $3900, the simple interest in 1 year

= ⁷/₁₀₀ × 3900

= ^{7 × 3900}/₁₀₀

= ²⁷³⁰⁰/₁₀₀ = $273

Thus, simple interest for 1 year = $273

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $273 × 3 = $819

Thus, Simple Interest (SI) = $819

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3900 + $819

= $4719

Thus, Amount to be paid = $4719 Answer

Similar Questions

(1) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 3% simple interest.

(2) Calculate the amount due if Robert borrowed a sum of $3100 at 10% simple interest for 3 years.

(3) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 2% simple interest for 7 years.

(4) What amount does William have to pay after 5 years if he takes a loan of $3500 at 5% simple interest?

(5) Barbara took a loan of $5100 at the rate of 9% simple interest per annum. If he paid an amount of $9690 to clear the loan, then find the time period of the loan.

(6) Joseph had to pay $4144 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(7) In how much time a principal of $3000 will amount to $3360 at a simple interest of 3% per annum?

(8) Susan took a loan of $5300 at the rate of 6% simple interest per annum. If he paid an amount of $8480 to clear the loan, then find the time period of the loan.

(9) Andrew had to pay $5520 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(10) How much loan did Kenneth borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8750 to clear it?