Simple Interest
Math MCQs

Question :    What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 3% simple interest?

Correct Answer  $4197.5

Solution & Explanation

Solution

Given,

Principal (P) = $3650

Rate of Simple Interest (SI) = 3%

Time (t) = 5 years

Thus, Amount (A) = ?

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

Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $3650 × 3% × 5

= $3650 ׳/₁₀₀ × 5

= ^{3650 × 3 × 5}/₁₀₀

= ^{10950 × 5}/₁₀₀

= ⁵⁴⁷⁵⁰/₁₀₀

= $547.5

Thus, Simple Interest = $547.5

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 = $3650 + $547.5

= $4197.5

Thus, Amount to be paid = $4197.5 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 = $3650

Rate of Simple Interest (SI) or (R) = 3%

And, Time (t) = 5 years

Thus, Amount (A)

= $3650 + ($3650 × 3% × 5)

= $3650 + ($3650 ׳/₁₀₀ × 5)

= $3650 + (^{3650 × 3 × 5}/₁₀₀)

= $3650 + (^{10950 × 5}/₁₀₀)

= $3650 + (⁵⁴⁷⁵⁰/₁₀₀)

= $3650 + $547.5 = $4197.5

Thus, Amount (A) to be paid = $4197.5 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 3%

This, means, $3 per $100 per year

∵ For $100, the simple interest for 1 year = $3

∴ For $1, the simple interest for 1 year = ³/₁₀₀

∴ For $3650, the simple interest in 1 year

= ³/₁₀₀ × 3650

= ^{3 × 3650}/₁₀₀

= ¹⁰⁹⁵⁰/₁₀₀ = $109.5

Thus, simple interest for 1 year = $109.5

Therefore, simple interest for 5 years

= Simple interest for 1 year × 5

= $109.5 × 5 = $547.5

Thus, Simple Interest (SI) = $547.5

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3650 + $547.5

= $4197.5

Thus, Amount to be paid = $4197.5 Answer

Similar Questions

(1) Calculate the amount due if Michael borrowed a sum of $3300 at 5% simple interest for 4 years.

(2) Calculate the amount due if Michael borrowed a sum of $3300 at 10% simple interest for 4 years.

(3) David had to pay $3604 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(4) Kimberly had to pay $5068.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(5) William had to pay $3710 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(6) Calculate the amount due after 10 years if Mary borrowed a sum of $5050 at a rate of 9% simple interest.

(7) How much loan did Charles borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6785 to clear it?

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

(9) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 2% simple interest.

(10) How much loan did Stephanie borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8305 to clear it?