Simple Interest
Math MCQs

Question :    Calculate the amount due if Barbara borrowed a sum of $3550 at 7% simple interest for 4 years.

Correct Answer  $4544

Solution & Explanation

Solution

Given,

Principal (P) = $3550

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) = $3550 × 7% × 4

= $3550 ×⁷/₁₀₀ × 4

= ^{3550 × 7 × 4}/₁₀₀

= ^{24850 × 4}/₁₀₀

= ⁹⁹⁴⁰⁰/₁₀₀

= $994

Thus, Simple Interest = $994

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 = $3550 + $994

= $4544

Thus, Amount to be paid = $4544 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 = $3550

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

And, Time (t) = 4 years

Thus, Amount (A)

= $3550 + ($3550 × 7% × 4)

= $3550 + ($3550 ×⁷/₁₀₀ × 4)

= $3550 + (^{3550 × 7 × 4}/₁₀₀)

= $3550 + (^{24850 × 4}/₁₀₀)

= $3550 + (⁹⁹⁴⁰⁰/₁₀₀)

= $3550 + $994 = $4544

Thus, Amount (A) to be paid = $4544 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 $3550, the simple interest in 1 year

= ⁷/₁₀₀ × 3550

= ^{7 × 3550}/₁₀₀

= ²⁴⁸⁵⁰/₁₀₀ = $248.5

Thus, simple interest for 1 year = $248.5

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $248.5 × 4 = $994

Thus, Simple Interest (SI) = $994

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3550 + $994

= $4544

Thus, Amount to be paid = $4544 Answer

Similar Questions

(1) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 2% simple interest?

(2) If Nancy paid $4980 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(3) Lisa took a loan of $6100 at the rate of 8% simple interest per annum. If he paid an amount of $10492 to clear the loan, then find the time period of the loan.

(4) How much loan did Kevin borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7810 to clear it?

(5) If Christopher paid $4800 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(6) David took a loan of $4800 at the rate of 10% simple interest per annum. If he paid an amount of $8640 to clear the loan, then find the time period of the loan.

(7) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 9% simple interest.

(8) If Charles paid $4368 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(9) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 3% simple interest?

(10) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 6% simple interest.