Simple Interest
Math MCQs

Question :    Calculate the amount due if Linda borrowed a sum of $3350 at 5% simple interest for 4 years.

Correct Answer  $4020

Solution & Explanation

Solution

Given,

Principal (P) = $3350

Rate of Simple Interest (SI) = 5%

Time (t) = 4 years

Thus, Amount (A) = ?

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

Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $3350 × 5% × 4

= $3350 ×⁵/₁₀₀ × 4

= ^{3350 × 5 × 4}/₁₀₀

= ^{16750 × 4}/₁₀₀

= ⁶⁷⁰⁰⁰/₁₀₀

= $670

Thus, Simple Interest = $670

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 = $3350 + $670

= $4020

Thus, Amount to be paid = $4020 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 = $3350

Rate of Simple Interest (SI) or (R) = 5%

And, Time (t) = 4 years

Thus, Amount (A)

= $3350 + ($3350 × 5% × 4)

= $3350 + ($3350 ×⁵/₁₀₀ × 4)

= $3350 + (^{3350 × 5 × 4}/₁₀₀)

= $3350 + (^{16750 × 4}/₁₀₀)

= $3350 + (⁶⁷⁰⁰⁰/₁₀₀)

= $3350 + $670 = $4020

Thus, Amount (A) to be paid = $4020 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 5%

This, means, $5 per $100 per year

∵ For $100, the simple interest for 1 year = $5

∴ For $1, the simple interest for 1 year = ⁵/₁₀₀

∴ For $3350, the simple interest in 1 year

= ⁵/₁₀₀ × 3350

= ^{5 × 3350}/₁₀₀

= ¹⁶⁷⁵⁰/₁₀₀ = $167.5

Thus, simple interest for 1 year = $167.5

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $167.5 × 4 = $670

Thus, Simple Interest (SI) = $670

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3350 + $670

= $4020

Thus, Amount to be paid = $4020 Answer

Similar Questions

(1) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 8% simple interest.

(2) Mark took a loan of $6800 at the rate of 6% simple interest per annum. If he paid an amount of $9248 to clear the loan, then find the time period of the loan.

(3) Donald took a loan of $7000 at the rate of 10% simple interest per annum. If he paid an amount of $14000 to clear the loan, then find the time period of the loan.

(4) Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $11247 to clear the loan, then find the time period of the loan.

(5) Joshua had to pay $5635 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(6) Find the amount to be paid if Michael borrowed a sum of $5300 at 7% simple interest for 7 years.

(7) Michael took a loan of $4600 at the rate of 6% simple interest per annum. If he paid an amount of $7360 to clear the loan, then find the time period of the loan.

(8) Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $9798 to clear the loan, then find the time period of the loan.

(9) If Emily paid $5700 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(10) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 7% simple interest.