Simple Interest
Math MCQs

Question :    Calculate the amount due if Charles borrowed a sum of $3900 at 4% simple interest for 4 years.

Correct Answer  $4524

Solution & Explanation

Solution

Given,

Principal (P) = $3900

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) = $3900 × 4% × 4

= $3900 ×⁴/₁₀₀ × 4

= ^{3900 × 4 × 4}/₁₀₀

= ^{15600 × 4}/₁₀₀

= ⁶²⁴⁰⁰/₁₀₀

= $624

Thus, Simple Interest = $624

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 = $3900 + $624

= $4524

Thus, Amount to be paid = $4524 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 = $3900

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

And, Time (t) = 4 years

Thus, Amount (A)

= $3900 + ($3900 × 4% × 4)

= $3900 + ($3900 ×⁴/₁₀₀ × 4)

= $3900 + (^{3900 × 4 × 4}/₁₀₀)

= $3900 + (^{15600 × 4}/₁₀₀)

= $3900 + (⁶²⁴⁰⁰/₁₀₀)

= $3900 + $624 = $4524

Thus, Amount (A) to be paid = $4524 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 $3900, the simple interest in 1 year

= ⁴/₁₀₀ × 3900

= ^{4 × 3900}/₁₀₀

= ¹⁵⁶⁰⁰/₁₀₀ = $156

Thus, simple interest for 1 year = $156

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $156 × 4 = $624

Thus, Simple Interest (SI) = $624

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3900 + $624

= $4524

Thus, Amount to be paid = $4524 Answer

Similar Questions

(1) Calculate the amount due if Patricia borrowed a sum of $3150 at 10% simple interest for 3 years.

(2) Calculate the amount due if Mary borrowed a sum of $3050 at 6% simple interest for 3 years.

(3) How much loan did Patricia borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5665 to clear it?

(4) Daniel took a loan of $6200 at the rate of 6% simple interest per annum. If he paid an amount of $9920 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due if Richard borrowed a sum of $3600 at 8% simple interest for 4 years.

(6) In how much time a principal of $3100 will amount to $3472 at a simple interest of 4% per annum?

(7) In how much time a principal of $3200 will amount to $3712 at a simple interest of 4% per annum?

(8) Calculate the amount due if Patricia borrowed a sum of $3150 at 7% simple interest for 3 years.

(9) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $11222 to clear the loan, then find the time period of the loan.

(10) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 6% simple interest.