Simple Interest
Math MCQs

Question :    Calculate the amount due if Thomas borrowed a sum of $3800 at 10% simple interest for 4 years.

Correct Answer  $5320

Solution & Explanation

Solution

Given,

Principal (P) = $3800

Rate of Simple Interest (SI) = 10%

Time (t) = 4 years

Thus, Amount (A) = ?

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

Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $3800 × 10% × 4

= $3800 ×¹⁰/₁₀₀ × 4

= ^{3800 × 10 × 4}/₁₀₀

= ^{38000 × 4}/₁₀₀

= ¹⁵²⁰⁰⁰/₁₀₀

= $1520

Thus, Simple Interest = $1520

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 = $3800 + $1520

= $5320

Thus, Amount to be paid = $5320 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 = $3800

Rate of Simple Interest (SI) or (R) = 10%

And, Time (t) = 4 years

Thus, Amount (A)

= $3800 + ($3800 × 10% × 4)

= $3800 + ($3800 ×¹⁰/₁₀₀ × 4)

= $3800 + (^{3800 × 10 × 4}/₁₀₀)

= $3800 + (^{38000 × 4}/₁₀₀)

= $3800 + (¹⁵²⁰⁰⁰/₁₀₀)

= $3800 + $1520 = $5320

Thus, Amount (A) to be paid = $5320 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 10%

This, means, $10 per $100 per year

∵ For $100, the simple interest for 1 year = $10

∴ For $1, the simple interest for 1 year = ¹⁰/₁₀₀

∴ For $3800, the simple interest in 1 year

= ¹⁰/₁₀₀ × 3800

= ^{10 × 3800}/₁₀₀

= ³⁸⁰⁰⁰/₁₀₀ = $380

Thus, simple interest for 1 year = $380

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $380 × 4 = $1520

Thus, Simple Interest (SI) = $1520

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3800 + $1520

= $5320

Thus, Amount to be paid = $5320 Answer

Similar Questions

(1) In how much time a principal of $3100 will amount to $3286 at a simple interest of 3% per annum?

(2) Calculate the amount due if Sarah borrowed a sum of $3850 at 7% simple interest for 4 years.

(3) How much loan did Thomas borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7250 to clear it?

(4) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 10% simple interest for 4 years.

(5) How much loan did Ryan borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8690 to clear it?

(6) Calculate the amount due if Michael borrowed a sum of $3300 at 10% simple interest for 3 years.

(7) Charles took a loan of $5800 at the rate of 7% simple interest per annum. If he paid an amount of $8236 to clear the loan, then find the time period of the loan.

(8) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 3% simple interest?

(9) What amount will be due after 2 years if Paul borrowed a sum of $3850 at a 10% simple interest?

(10) What amount does David have to pay after 5 years if he takes a loan of $3400 at 6% simple interest?