Simple Interest
Math MCQs

Question :    Calculate the amount due if Sarah borrowed a sum of $3850 at 9% simple interest for 4 years.

Correct Answer  $5236

Solution & Explanation

Solution

Given,

Principal (P) = $3850

Rate of Simple Interest (SI) = 9%

Time (t) = 4 years

Thus, Amount (A) = ?

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

Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $3850 × 9% × 4

= $3850 ×⁹/₁₀₀ × 4

= ^{3850 × 9 × 4}/₁₀₀

= ^{34650 × 4}/₁₀₀

= ¹³⁸⁶⁰⁰/₁₀₀

= $1386

Thus, Simple Interest = $1386

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 = $3850 + $1386

= $5236

Thus, Amount to be paid = $5236 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 = $3850

Rate of Simple Interest (SI) or (R) = 9%

And, Time (t) = 4 years

Thus, Amount (A)

= $3850 + ($3850 × 9% × 4)

= $3850 + ($3850 ×⁹/₁₀₀ × 4)

= $3850 + (^{3850 × 9 × 4}/₁₀₀)

= $3850 + (^{34650 × 4}/₁₀₀)

= $3850 + (¹³⁸⁶⁰⁰/₁₀₀)

= $3850 + $1386 = $5236

Thus, Amount (A) to be paid = $5236 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 9%

This, means, $9 per $100 per year

∵ For $100, the simple interest for 1 year = $9

∴ For $1, the simple interest for 1 year = ⁹/₁₀₀

∴ For $3850, the simple interest in 1 year

= ⁹/₁₀₀ × 3850

= ^{9 × 3850}/₁₀₀

= ³⁴⁶⁵⁰/₁₀₀ = $346.5

Thus, simple interest for 1 year = $346.5

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $346.5 × 4 = $1386

Thus, Simple Interest (SI) = $1386

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3850 + $1386

= $5236

Thus, Amount to be paid = $5236 Answer

Similar Questions

(1) Elizabeth took a loan of $4900 at the rate of 7% simple interest per annum. If he paid an amount of $6958 to clear the loan, then find the time period of the loan.

(2) What amount will be due after 2 years if Paul borrowed a sum of $3850 at a 4% simple interest?

(3) If Lisa paid $4698 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(4) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 4% simple interest?

(5) Find the amount to be paid if John borrowed a sum of $5200 at 8% simple interest for 8 years.

(6) Find the amount to be paid if Barbara borrowed a sum of $5550 at 2% simple interest for 8 years.

(7) Calculate the amount due if Karen borrowed a sum of $3950 at 10% simple interest for 4 years.

(8) Daniel took a loan of $6200 at the rate of 7% simple interest per annum. If he paid an amount of $9238 to clear the loan, then find the time period of the loan.

(9) In how much time a principal of $3000 will amount to $3240 at a simple interest of 2% per annum?

(10) What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 8% simple interest?