Simple Interest
Math MCQs

Question :    Calculate the amount due if Robert borrowed a sum of $3100 at 7% simple interest for 4 years.

Correct Answer  $3968

Solution & Explanation

Solution

Given,

Principal (P) = $3100

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) = $3100 × 7% × 4

= $3100 ×⁷/₁₀₀ × 4

= ^{3100 × 7 × 4}/₁₀₀

= ^{21700 × 4}/₁₀₀

= ⁸⁶⁸⁰⁰/₁₀₀

= $868

Thus, Simple Interest = $868

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 = $3100 + $868

= $3968

Thus, Amount to be paid = $3968 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 = $3100

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

And, Time (t) = 4 years

Thus, Amount (A)

= $3100 + ($3100 × 7% × 4)

= $3100 + ($3100 ×⁷/₁₀₀ × 4)

= $3100 + (^{3100 × 7 × 4}/₁₀₀)

= $3100 + (^{21700 × 4}/₁₀₀)

= $3100 + (⁸⁶⁸⁰⁰/₁₀₀)

= $3100 + $868 = $3968

Thus, Amount (A) to be paid = $3968 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 $3100, the simple interest in 1 year

= ⁷/₁₀₀ × 3100

= ^{7 × 3100}/₁₀₀

= ²¹⁷⁰⁰/₁₀₀ = $217

Thus, simple interest for 1 year = $217

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $217 × 4 = $868

Thus, Simple Interest (SI) = $868

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3100 + $868

= $3968

Thus, Amount to be paid = $3968 Answer

Similar Questions

(1) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 10% simple interest?

(2) Margaret took a loan of $6700 at the rate of 9% simple interest per annum. If he paid an amount of $10921 to clear the loan, then find the time period of the loan.

(3) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 2% simple interest?

(4) Joseph took a loan of $5400 at the rate of 10% simple interest per annum. If he paid an amount of $10800 to clear the loan, then find the time period of the loan.

(5) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $8480 to clear the loan, then find the time period of the loan.

(6) Find the amount to be paid if Joseph borrowed a sum of $5700 at 2% simple interest for 8 years.

(7) Sarah had to pay $4312 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(8) What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 9% simple interest?

(9) If Andrew paid $5184 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(10) Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $9685 to clear the loan, then find the time period of the loan.