Simple Interest
Math MCQs

Question :    Calculate the amount due if Robert borrowed a sum of $3100 at 2% simple interest for 4 years.

Correct Answer  $3348

Solution & Explanation

Solution

Given,

Principal (P) = $3100

Rate of Simple Interest (SI) = 2%

Time (t) = 4 years

Thus, Amount (A) = ?

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

Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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) = $3100 × 2% × 4

= $3100 ײ/₁₀₀ × 4

= ^{3100 × 2 × 4}/₁₀₀

= ^{6200 × 4}/₁₀₀

= ²⁴⁸⁰⁰/₁₀₀

= $248

Thus, Simple Interest = $248

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 = $3100 + $248

= $3348

Thus, Amount to be paid = $3348 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 = $3100

Rate of Simple Interest (SI) or (R) = 2%

And, Time (t) = 4 years

Thus, Amount (A)

= $3100 + ($3100 × 2% × 4)

= $3100 + ($3100 ײ/₁₀₀ × 4)

= $3100 + (^{3100 × 2 × 4}/₁₀₀)

= $3100 + (^{6200 × 4}/₁₀₀)

= $3100 + (²⁴⁸⁰⁰/₁₀₀)

= $3100 + $248 = $3348

Thus, Amount (A) to be paid = $3348 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 2%

This, means, $2 per $100 per year

∵ For $100, the simple interest for 1 year = $2

∴ For $1, the simple interest for 1 year = ²/₁₀₀

∴ For $3100, the simple interest in 1 year

= ²/₁₀₀ × 3100

= ^{2 × 3100}/₁₀₀

= ⁶²⁰⁰/₁₀₀ = $62

Thus, simple interest for 1 year = $62

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $62 × 4 = $248

Thus, Simple Interest (SI) = $248

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3100 + $248

= $3348

Thus, Amount to be paid = $3348 Answer

Similar Questions

(1) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 4% simple interest for 3 years.

(2) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 9% simple interest for 4 years.

(3) How much loan did Donna borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7535 to clear it?

(4) Calculate the amount due if Mary borrowed a sum of $3050 at 9% simple interest for 3 years.

(5) What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 8% simple interest?

(6) What amount does John have to pay after 5 years if he takes a loan of $3200 at 4% simple interest?

(7) What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 5% simple interest?

(8) Calculate the amount due if James borrowed a sum of $3000 at 5% simple interest for 4 years.

(9) Jessica had to pay $3975 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(10) Sarah took a loan of $5700 at the rate of 8% simple interest per annum. If he paid an amount of $8892 to clear the loan, then find the time period of the loan.