Simple Interest
Math MCQs

Question :    Calculate the amount due if Thomas borrowed a sum of $3800 at 4% simple interest for 4 years.

Correct Answer  $4408

Solution & Explanation

Solution

Given,

Principal (P) = $3800

Rate of Simple Interest (SI) = 4%

Time (t) = 4 years

Thus, Amount (A) = ?

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

Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $3800 × 4% × 4

= $3800 ×⁴/₁₀₀ × 4

= ^{3800 × 4 × 4}/₁₀₀

= ^{15200 × 4}/₁₀₀

= ⁶⁰⁸⁰⁰/₁₀₀

= $608

Thus, Simple Interest = $608

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 = $3800 + $608

= $4408

Thus, Amount to be paid = $4408 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 = $3800

Rate of Simple Interest (SI) or (R) = 4%

And, Time (t) = 4 years

Thus, Amount (A)

= $3800 + ($3800 × 4% × 4)

= $3800 + ($3800 ×⁴/₁₀₀ × 4)

= $3800 + (^{3800 × 4 × 4}/₁₀₀)

= $3800 + (^{15200 × 4}/₁₀₀)

= $3800 + (⁶⁰⁸⁰⁰/₁₀₀)

= $3800 + $608 = $4408

Thus, Amount (A) to be paid = $4408 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 4%

This, means, $4 per $100 per year

∵ For $100, the simple interest for 1 year = $4

∴ For $1, the simple interest for 1 year = ⁴/₁₀₀

∴ For $3800, the simple interest in 1 year

= ⁴/₁₀₀ × 3800

= ^{4 × 3800}/₁₀₀

= ¹⁵²⁰⁰/₁₀₀ = $152

Thus, simple interest for 1 year = $152

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $152 × 4 = $608

Thus, Simple Interest (SI) = $608

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3800 + $608

= $4408

Thus, Amount to be paid = $4408 Answer

Similar Questions

(1) Joseph took a loan of $5400 at the rate of 10% simple interest per annum. If he paid an amount of $8640 to clear the loan, then find the time period of the loan.

(2) What amount will be due after 2 years if James borrowed a sum of $3000 at a 8% simple interest?

(3) Lisa took a loan of $6100 at the rate of 9% simple interest per annum. If he paid an amount of $11041 to clear the loan, then find the time period of the loan.

(4) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 5% simple interest for 7 years.

(5) How much loan did Thomas borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6670 to clear it?

(6) Joseph took a loan of $5400 at the rate of 10% simple interest per annum. If he paid an amount of $10800 to clear the loan, then find the time period of the loan.

(7) Joseph took a loan of $5400 at the rate of 6% simple interest per annum. If he paid an amount of $7992 to clear the loan, then find the time period of the loan.

(8) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 8% simple interest?

(9) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 4% simple interest.

(10) Donald took a loan of $7000 at the rate of 8% simple interest per annum. If he paid an amount of $12600 to clear the loan, then find the time period of the loan.