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 if Michael borrowed a sum of $3300 at 10% simple interest for 4 years.

(2) Find the amount to be paid if Susan borrowed a sum of $5650 at 8% simple interest for 7 years.

(3) In how much time a principal of $3000 will amount to $3450 at a simple interest of 3% per annum?

(4) How much loan did Amanda borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7865 to clear it?

(5) Christopher took a loan of $6000 at the rate of 6% simple interest per annum. If he paid an amount of $8160 to clear the loan, then find the time period of the loan.

(6) Margaret took a loan of $6700 at the rate of 10% simple interest per annum. If he paid an amount of $13400 to clear the loan, then find the time period of the loan.

(7) Find the amount to be paid if Susan borrowed a sum of $5650 at 5% simple interest for 7 years.

(8) Find the amount to be paid if Robert borrowed a sum of $5100 at 9% simple interest for 8 years.

(9) How much loan did Kenneth borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8050 to clear it?

(10) Find the amount to be paid if Thomas borrowed a sum of $5800 at 10% simple interest for 8 years.