Simple Interest
Math MCQs

Question :    Calculate the amount due if Michael borrowed a sum of $3300 at 7% simple interest for 4 years.

Correct Answer  $4224

Solution & Explanation

Solution

Given,

Principal (P) = $3300

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) = $3300 × 7% × 4

= $3300 ×⁷/₁₀₀ × 4

= ^{3300 × 7 × 4}/₁₀₀

= ^{23100 × 4}/₁₀₀

= ⁹²⁴⁰⁰/₁₀₀

= $924

Thus, Simple Interest = $924

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 = $3300 + $924

= $4224

Thus, Amount to be paid = $4224 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 = $3300

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

And, Time (t) = 4 years

Thus, Amount (A)

= $3300 + ($3300 × 7% × 4)

= $3300 + ($3300 ×⁷/₁₀₀ × 4)

= $3300 + (^{3300 × 7 × 4}/₁₀₀)

= $3300 + (^{23100 × 4}/₁₀₀)

= $3300 + (⁹²⁴⁰⁰/₁₀₀)

= $3300 + $924 = $4224

Thus, Amount (A) to be paid = $4224 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 $3300, the simple interest in 1 year

= ⁷/₁₀₀ × 3300

= ^{7 × 3300}/₁₀₀

= ²³¹⁰⁰/₁₀₀ = $231

Thus, simple interest for 1 year = $231

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $231 × 4 = $924

Thus, Simple Interest (SI) = $924

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3300 + $924

= $4224

Thus, Amount to be paid = $4224 Answer

Similar Questions

(1) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 4% simple interest.

(2) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $7172 to clear the loan, then find the time period of the loan.

(3) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 6% simple interest for 4 years.

(4) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 10% simple interest?

(5) Calculate the amount due after 10 years if Mary borrowed a sum of $5050 at a rate of 10% simple interest.

(6) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 7% simple interest.

(7) Find the amount to be paid if Patricia borrowed a sum of $5150 at 9% simple interest for 7 years.

(8) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 8% simple interest.

(9) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 7% simple interest for 7 years.

(10) Donna had to pay $5286.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.