Simple Interest
Math MCQs

Question :    Calculate the amount due if Joseph borrowed a sum of $3700 at 7% simple interest for 4 years.

Correct Answer  $4736

Solution & Explanation

Solution

Given,

Principal (P) = $3700

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) = $3700 × 7% × 4

= $3700 ×⁷/₁₀₀ × 4

= ^{3700 × 7 × 4}/₁₀₀

= ^{25900 × 4}/₁₀₀

= ¹⁰³⁶⁰⁰/₁₀₀

= $1036

Thus, Simple Interest = $1036

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 = $3700 + $1036

= $4736

Thus, Amount to be paid = $4736 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 = $3700

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

And, Time (t) = 4 years

Thus, Amount (A)

= $3700 + ($3700 × 7% × 4)

= $3700 + ($3700 ×⁷/₁₀₀ × 4)

= $3700 + (^{3700 × 7 × 4}/₁₀₀)

= $3700 + (^{25900 × 4}/₁₀₀)

= $3700 + (¹⁰³⁶⁰⁰/₁₀₀)

= $3700 + $1036 = $4736

Thus, Amount (A) to be paid = $4736 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 $3700, the simple interest in 1 year

= ⁷/₁₀₀ × 3700

= ^{7 × 3700}/₁₀₀

= ²⁵⁹⁰⁰/₁₀₀ = $259

Thus, simple interest for 1 year = $259

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $259 × 4 = $1036

Thus, Simple Interest (SI) = $1036

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3700 + $1036

= $4736

Thus, Amount to be paid = $4736 Answer

Similar Questions

(1) How much loan did David borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5940 to clear it?

(2) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 3% simple interest?

(3) Calculate the amount due if Richard borrowed a sum of $3600 at 10% simple interest for 3 years.

(4) 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.

(5) What amount does James have to pay after 6 years if he takes a loan of $3000 at 9% simple interest?

(6) If David paid $3672 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(7) Find the amount to be paid if Robert borrowed a sum of $5100 at 3% simple interest for 8 years.

(8) Donald took a loan of $7000 at the rate of 9% simple interest per annum. If he paid an amount of $12040 to clear the loan, then find the time period of the loan.

(9) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 4% simple interest?

(10) Find the amount to be paid if Christopher borrowed a sum of $6000 at 9% simple interest for 7 years.