Simple Interest
Math MCQs

Question :    Calculate the amount due if Michael borrowed a sum of $3300 at 8% simple interest for 3 years.

Correct Answer  $4092

Solution & Explanation

Solution

Given,

Principal (P) = $3300

Rate of Simple Interest (SI) = 8%

Time (t) = 3 years

Thus, Amount (A) = ?

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

Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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) = $3300 × 8% × 3

= $3300 ×⁸/₁₀₀ × 3

= ^{3300 × 8 × 3}/₁₀₀

= ^{26400 × 3}/₁₀₀

= ⁷⁹²⁰⁰/₁₀₀

= $792

Thus, Simple Interest = $792

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 = $3300 + $792

= $4092

Thus, Amount to be paid = $4092 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 = $3300

Rate of Simple Interest (SI) or (R) = 8%

And, Time (t) = 3 years

Thus, Amount (A)

= $3300 + ($3300 × 8% × 3)

= $3300 + ($3300 ×⁸/₁₀₀ × 3)

= $3300 + (^{3300 × 8 × 3}/₁₀₀)

= $3300 + (^{26400 × 3}/₁₀₀)

= $3300 + (⁷⁹²⁰⁰/₁₀₀)

= $3300 + $792 = $4092

Thus, Amount (A) to be paid = $4092 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 8%

This, means, $8 per $100 per year

∵ For $100, the simple interest for 1 year = $8

∴ For $1, the simple interest for 1 year = ⁸/₁₀₀

∴ For $3300, the simple interest in 1 year

= ⁸/₁₀₀ × 3300

= ^{8 × 3300}/₁₀₀

= ²⁶⁴⁰⁰/₁₀₀ = $264

Thus, simple interest for 1 year = $264

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $264 × 3 = $792

Thus, Simple Interest (SI) = $792

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3300 + $792

= $4092

Thus, Amount to be paid = $4092 Answer

Similar Questions

(1) Calculate the amount due if Sarah borrowed a sum of $3850 at 3% simple interest for 4 years.

(2) How much loan did Steven borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7260 to clear it?

(3) Lisa took a loan of $6100 at the rate of 7% simple interest per annum. If he paid an amount of $8662 to clear the loan, then find the time period of the loan.

(4) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 10% simple interest?

(5) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $11400 to clear the loan, then find the time period of the loan.

(6) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 4% simple interest.

(7) How much loan did Betty borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6875 to clear it?

(8) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 4% simple interest.

(9) Richard took a loan of $5200 at the rate of 9% simple interest per annum. If he paid an amount of $8944 to clear the loan, then find the time period of the loan.

(10) Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 2% simple interest.