Simple Interest
Math MCQs

Question :    Calculate the amount due if Mary borrowed a sum of $3050 at 8% simple interest for 4 years.

Correct Answer  $4026

Solution & Explanation

Solution

Given,

Principal (P) = $3050

Rate of Simple Interest (SI) = 8%

Time (t) = 4 years

Thus, Amount (A) = ?

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

Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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 × 8% × 4

= $3050 ×⁸/₁₀₀ × 4

= ^{3050 × 8 × 4}/₁₀₀

= ^{24400 × 4}/₁₀₀

= ⁹⁷⁶⁰⁰/₁₀₀

= $976

Thus, Simple Interest = $976

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 + $976

= $4026

Thus, Amount to be paid = $4026 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) = 8%

And, Time (t) = 4 years

Thus, Amount (A)

= $3050 + ($3050 × 8% × 4)

= $3050 + ($3050 ×⁸/₁₀₀ × 4)

= $3050 + (^{3050 × 8 × 4}/₁₀₀)

= $3050 + (^{24400 × 4}/₁₀₀)

= $3050 + (⁹⁷⁶⁰⁰/₁₀₀)

= $3050 + $976 = $4026

Thus, Amount (A) to be paid = $4026 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 8%

This, means, $8 per $100 per year

∵ For $100, the simple interest for 1 year = $8

∴ For $1, the simple interest for 1 year = ⁸/₁₀₀

∴ For $3050, the simple interest in 1 year

= ⁸/₁₀₀ × 3050

= ^{8 × 3050}/₁₀₀

= ²⁴⁴⁰⁰/₁₀₀ = $244

Thus, simple interest for 1 year = $244

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $244 × 4 = $976

Thus, Simple Interest (SI) = $976

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3050 + $976

= $4026

Thus, Amount to be paid = $4026 Answer

Similar Questions

(1) Jessica took a loan of $5500 at the rate of 9% simple interest per annum. If he paid an amount of $10450 to clear the loan, then find the time period of the loan.

(2) Calculate the amount due if Robert borrowed a sum of $3100 at 3% simple interest for 4 years.

(3) Mark took a loan of $6800 at the rate of 6% simple interest per annum. If he paid an amount of $10064 to clear the loan, then find the time period of the loan.

(4) Daniel had to pay $4346 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(5) Find the amount to be paid if Charles borrowed a sum of $5900 at 7% simple interest for 8 years.

(6) If David borrowed $3400 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(7) James took a loan of $4000 at the rate of 10% simple interest per annum. If he paid an amount of $6800 to clear the loan, then find the time period of the loan.

(8) What amount does Mary have to pay after 5 years if he takes a loan of $3050 at 9% simple interest?

(9) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 10% simple interest?

(10) Michael had to pay $3696 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.