Simple Interest
Math MCQs

Question :    Calculate the amount due if Thomas borrowed a sum of $3800 at 5% simple interest for 4 years.

Correct Answer  $4560

Solution & Explanation

Solution

Given,

Principal (P) = $3800

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) = $3800 × 5% × 4

= $3800 ×⁵/₁₀₀ × 4

= ^{3800 × 5 × 4}/₁₀₀

= ^{19000 × 4}/₁₀₀

= ⁷⁶⁰⁰⁰/₁₀₀

= $760

Thus, Simple Interest = $760

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 + $760

= $4560

Thus, Amount to be paid = $4560 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) = 5%

And, Time (t) = 4 years

Thus, Amount (A)

= $3800 + ($3800 × 5% × 4)

= $3800 + ($3800 ×⁵/₁₀₀ × 4)

= $3800 + (^{3800 × 5 × 4}/₁₀₀)

= $3800 + (^{19000 × 4}/₁₀₀)

= $3800 + (⁷⁶⁰⁰⁰/₁₀₀)

= $3800 + $760 = $4560

Thus, Amount (A) to be paid = $4560 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 $3800, the simple interest in 1 year

= ⁵/₁₀₀ × 3800

= ^{5 × 3800}/₁₀₀

= ¹⁹⁰⁰⁰/₁₀₀ = $190

Thus, simple interest for 1 year = $190

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $190 × 4 = $760

Thus, Simple Interest (SI) = $760

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3800 + $760

= $4560

Thus, Amount to be paid = $4560 Answer

Similar Questions

(1) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 6% simple interest.

(2) Linda took a loan of $4700 at the rate of 10% simple interest per annum. If he paid an amount of $9400 to clear the loan, then find the time period of the loan.

(3) How much loan did Christopher borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7500 to clear it?

(4) James took a loan of $4000 at the rate of 9% simple interest per annum. If he paid an amount of $7240 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 2% simple interest.

(6) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 6% simple interest?

(7) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 5% simple interest.

(8) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 3% simple interest?

(9) Calculate the amount due if Mary borrowed a sum of $3050 at 10% simple interest for 4 years.

(10) Calculate the amount due after 10 years if Mary borrowed a sum of $5050 at a rate of 6% simple interest.