Simple Interest
Math MCQs

Question :    Calculate the amount due if Jessica borrowed a sum of $3750 at 8% simple interest for 3 years.

Correct Answer  $4650

Solution & Explanation

Solution

Given,

Principal (P) = $3750

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) = $3750 × 8% × 3

= $3750 ×⁸/₁₀₀ × 3

= ^{3750 × 8 × 3}/₁₀₀

= ^{30000 × 3}/₁₀₀

= ⁹⁰⁰⁰⁰/₁₀₀

= $900

Thus, Simple Interest = $900

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 = $3750 + $900

= $4650

Thus, Amount to be paid = $4650 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 = $3750

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

And, Time (t) = 3 years

Thus, Amount (A)

= $3750 + ($3750 × 8% × 3)

= $3750 + ($3750 ×⁸/₁₀₀ × 3)

= $3750 + (^{3750 × 8 × 3}/₁₀₀)

= $3750 + (^{30000 × 3}/₁₀₀)

= $3750 + (⁹⁰⁰⁰⁰/₁₀₀)

= $3750 + $900 = $4650

Thus, Amount (A) to be paid = $4650 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 $3750, the simple interest in 1 year

= ⁸/₁₀₀ × 3750

= ^{8 × 3750}/₁₀₀

= ³⁰⁰⁰⁰/₁₀₀ = $300

Thus, simple interest for 1 year = $300

Therefore, simple interest for 3 years

= Simple interest for 1 year × 3

= $300 × 3 = $900

Thus, Simple Interest (SI) = $900

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3750 + $900

= $4650

Thus, Amount to be paid = $4650 Answer

Similar Questions

(1) What amount does David have to pay after 6 years if he takes a loan of $3400 at 8% simple interest?

(2) Calculate the amount due if James borrowed a sum of $3000 at 2% simple interest for 3 years.

(3) William had to pay $3710 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(4) What amount will be due after 2 years if David borrowed a sum of $3200 at a 7% simple interest?

(5) Joshua had to pay $5341 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(6) Calculate the amount due if Thomas borrowed a sum of $3800 at 7% simple interest for 4 years.

(7) Joseph had to pay $4255 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(8) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $8100 to clear the loan, then find the time period of the loan.

(9) Jennifer took a loan of $4500 at the rate of 10% simple interest per annum. If he paid an amount of $8550 to clear the loan, then find the time period of the loan.

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