Simple Interest
Math MCQs

Question :  ( 1 of 10 )  Calculate the amount due if Charles borrowed a sum of $3900 at 5% simple interest for 4 years.

Correct Answer  $4680

Solution & Explanation

Solution

Given,

Principal (P) = $3900

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) = $3900 × 5% × 4

= $3900 ×⁵/₁₀₀ × 4

= ^{3900 × 5 × 4}/₁₀₀

= ^{19500 × 4}/₁₀₀

= ⁷⁸⁰⁰⁰/₁₀₀

= $780

Thus, Simple Interest = $780

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 + $780

= $4680

Thus, Amount to be paid = $4680 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) = 5%

And, Time (t) = 4 years

Thus, Amount (A)

= $3900 + ($3900 × 5% × 4)

= $3900 + ($3900 ×⁵/₁₀₀ × 4)

= $3900 + (^{3900 × 5 × 4}/₁₀₀)

= $3900 + (^{19500 × 4}/₁₀₀)

= $3900 + (⁷⁸⁰⁰⁰/₁₀₀)

= $3900 + $780 = $4680

Thus, Amount (A) to be paid = $4680 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 $3900, the simple interest in 1 year

= ⁵/₁₀₀ × 3900

= ^{5 × 3900}/₁₀₀

= ¹⁹⁵⁰⁰/₁₀₀ = $195

Thus, simple interest for 1 year = $195

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $195 × 4 = $780

Thus, Simple Interest (SI) = $780

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3900 + $780

= $4680

Thus, Amount to be paid = $4680 Answer

Similar Questions

(1) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 2% simple interest.

(2) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $5920 to clear the loan, then find the time period of the loan.

(3) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 7% simple interest.

(4) How much loan did Cynthia borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $9142.5 to clear it?

(5) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 6% simple interest.

(6) How much loan did Joseph borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6270 to clear it?

(7) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 6% simple interest?

(8) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 8% simple interest?

(9) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 8% simple interest.

(10) If Jennifer paid $3770 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.