Simple Interest
Math MCQs

Question :    Calculate the amount due if Mary borrowed a sum of $3050 at 7% simple interest for 4 years.

Correct Answer  $3904

Solution & Explanation

Solution

Given,

Principal (P) = $3050

Rate of Simple Interest (SI) = 7%

Time (t) = 4 years

Thus, Amount (A) = ?

The Rate of Interest is always calculated per annum, i.e. per year.

Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $3050 × 7% × 4

= $3050 ×⁷/₁₀₀ × 4

= ^{3050 × 7 × 4}/₁₀₀

= ^{21350 × 4}/₁₀₀

= ⁸⁵⁴⁰⁰/₁₀₀

= $854

Thus, Simple Interest = $854

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 = $3050 + $854

= $3904

Thus, Amount to be paid = $3904 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 = $3050

Rate of Simple Interest (SI) or (R) = 7%

And, Time (t) = 4 years

Thus, Amount (A)

= $3050 + ($3050 × 7% × 4)

= $3050 + ($3050 ×⁷/₁₀₀ × 4)

= $3050 + (^{3050 × 7 × 4}/₁₀₀)

= $3050 + (^{21350 × 4}/₁₀₀)

= $3050 + (⁸⁵⁴⁰⁰/₁₀₀)

= $3050 + $854 = $3904

Thus, Amount (A) to be paid = $3904 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 7%

This, means, $7 per $100 per year

∵ For $100, the simple interest for 1 year = $7

∴ For $1, the simple interest for 1 year = ⁷/₁₀₀

∴ For $3050, the simple interest in 1 year

= ⁷/₁₀₀ × 3050

= ^{7 × 3050}/₁₀₀

= ²¹³⁵⁰/₁₀₀ = $213.5

Thus, simple interest for 1 year = $213.5

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $213.5 × 4 = $854

Thus, Simple Interest (SI) = $854

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3050 + $854

= $3904

Thus, Amount to be paid = $3904 Answer

Similar Questions

(1) Calculate the amount due if Thomas borrowed a sum of $3800 at 10% simple interest for 3 years.

(2) In how much time a principal of $3050 will amount to $3538 at a simple interest of 4% per annum?

(3) If Kimberly paid $5394 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(4) In how much time a principal of $3050 will amount to $3233 at a simple interest of 3% per annum?

(5) If Robert paid $3472 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(6) Donald took a loan of $7000 at the rate of 7% simple interest per annum. If he paid an amount of $11410 to clear the loan, then find the time period of the loan.

(7) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 5% simple interest?

(8) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $10164 to clear the loan, then find the time period of the loan.

(9) How much loan did Charles borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6490 to clear it?

(10) What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 9% simple interest?