Simple Interest
Math MCQs

Question :    Calculate the amount due if Christopher borrowed a sum of $4000 at 5% simple interest for 4 years.

Correct Answer  $4800

Solution & Explanation

Solution

Given,

Principal (P) = $4000

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) = $4000 × 5% × 4

= $4000 ×⁵/₁₀₀ × 4

= ^{4000 × 5 × 4}/₁₀₀

= ^{20000 × 4}/₁₀₀

= ⁸⁰⁰⁰⁰/₁₀₀

= $800

Thus, Simple Interest = $800

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 = $4000 + $800

= $4800

Thus, Amount to be paid = $4800 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 = $4000

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

And, Time (t) = 4 years

Thus, Amount (A)

= $4000 + ($4000 × 5% × 4)

= $4000 + ($4000 ×⁵/₁₀₀ × 4)

= $4000 + (^{4000 × 5 × 4}/₁₀₀)

= $4000 + (^{20000 × 4}/₁₀₀)

= $4000 + (⁸⁰⁰⁰⁰/₁₀₀)

= $4000 + $800 = $4800

Thus, Amount (A) to be paid = $4800 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 $4000, the simple interest in 1 year

= ⁵/₁₀₀ × 4000

= ^{5 × 4000}/₁₀₀

= ²⁰⁰⁰⁰/₁₀₀ = $200

Thus, simple interest for 1 year = $200

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $200 × 4 = $800

Thus, Simple Interest (SI) = $800

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $4000 + $800

= $4800

Thus, Amount to be paid = $4800 Answer

Similar Questions

(1) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7980 to clear it?

(2) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 6% simple interest.

(3) Calculate the amount due if William borrowed a sum of $3500 at 6% simple interest for 3 years.

(4) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $6864 to clear the loan, then find the time period of the loan.

(5) Find the amount to be paid if Richard borrowed a sum of $5600 at 7% simple interest for 8 years.

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

(7) If Joshua paid $5684 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(8) Calculate the amount due if Sarah borrowed a sum of $3850 at 8% simple interest for 3 years.

(9) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $9780 to clear the loan, then find the time period of the loan.

(10) Mark took a loan of $6800 at the rate of 10% simple interest per annum. If he paid an amount of $13600 to clear the loan, then find the time period of the loan.