Simple Interest
Math MCQs

Question :    Calculate the amount due if Christopher borrowed a sum of $4000 at 3% simple interest for 4 years.

Correct Answer  $4480

Solution & Explanation

Solution

Given,

Principal (P) = $4000

Rate of Simple Interest (SI) = 3%

Time (t) = 4 years

Thus, Amount (A) = ?

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

Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $4000 × 3% × 4

= $4000 ׳/₁₀₀ × 4

= ^{4000 × 3 × 4}/₁₀₀

= ^{12000 × 4}/₁₀₀

= ⁴⁸⁰⁰⁰/₁₀₀

= $480

Thus, Simple Interest = $480

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 = $4000 + $480

= $4480

Thus, Amount to be paid = $4480 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 = $4000

Rate of Simple Interest (SI) or (R) = 3%

And, Time (t) = 4 years

Thus, Amount (A)

= $4000 + ($4000 × 3% × 4)

= $4000 + ($4000 ׳/₁₀₀ × 4)

= $4000 + (^{4000 × 3 × 4}/₁₀₀)

= $4000 + (^{12000 × 4}/₁₀₀)

= $4000 + (⁴⁸⁰⁰⁰/₁₀₀)

= $4000 + $480 = $4480

Thus, Amount (A) to be paid = $4480 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 3%

This, means, $3 per $100 per year

∵ For $100, the simple interest for 1 year = $3

∴ For $1, the simple interest for 1 year = ³/₁₀₀

∴ For $4000, the simple interest in 1 year

= ³/₁₀₀ × 4000

= ^{3 × 4000}/₁₀₀

= ¹²⁰⁰⁰/₁₀₀ = $120

Thus, simple interest for 1 year = $120

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $120 × 4 = $480

Thus, Simple Interest (SI) = $480

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $4000 + $480

= $4480

Thus, Amount to be paid = $4480 Answer

Similar Questions

(1) Donald took a loan of $7000 at the rate of 9% simple interest per annum. If he paid an amount of $10780 to clear the loan, then find the time period of the loan.

(2) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 2% simple interest?

(3) Find the amount to be paid if Patricia borrowed a sum of $5150 at 3% simple interest for 8 years.

(4) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 2% simple interest?

(5) Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $10281 to clear the loan, then find the time period of the loan.

(6) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 8% simple interest.

(7) Jennifer took a loan of $4500 at the rate of 10% simple interest per annum. If he paid an amount of $8100 to clear the loan, then find the time period of the loan.

(8) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 3% simple interest.

(9) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $7392 to clear the loan, then find the time period of the loan.

(10) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $6880 to clear the loan, then find the time period of the loan.