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) In how much time a principal of $3100 will amount to $3410 at a simple interest of 5% per annum?

(2) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 3% simple interest.

(3) Find the amount to be paid if Susan borrowed a sum of $5650 at 9% simple interest for 7 years.

(4) Sarah took a loan of $5700 at the rate of 7% simple interest per annum. If he paid an amount of $9690 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 5% simple interest.

(6) Calculate the amount due if Jessica borrowed a sum of $3750 at 4% simple interest for 4 years.

(7) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 4% simple interest.

(8) If Thomas paid $4104 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(9) Nancy took a loan of $6300 at the rate of 7% simple interest per annum. If he paid an amount of $10710 to clear the loan, then find the time period of the loan.

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