Simple Interest
Math MCQs

Question :    What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 5% simple interest?

Correct Answer  $4500

Solution & Explanation

Solution

Given,

Principal (P) = $3600

Rate of Simple Interest (SI) = 5%

Time (t) = 5 years

Thus, Amount (A) = ?

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

Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $3600 × 5% × 5

= $3600 ×⁵/₁₀₀ × 5

= ^{3600 × 5 × 5}/₁₀₀

= ^{18000 × 5}/₁₀₀

= ⁹⁰⁰⁰⁰/₁₀₀

= $900

Thus, Simple Interest = $900

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 = $3600 + $900

= $4500

Thus, Amount to be paid = $4500 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 = $3600

Rate of Simple Interest (SI) or (R) = 5%

And, Time (t) = 5 years

Thus, Amount (A)

= $3600 + ($3600 × 5% × 5)

= $3600 + ($3600 ×⁵/₁₀₀ × 5)

= $3600 + (^{3600 × 5 × 5}/₁₀₀)

= $3600 + (^{18000 × 5}/₁₀₀)

= $3600 + (⁹⁰⁰⁰⁰/₁₀₀)

= $3600 + $900 = $4500

Thus, Amount (A) to be paid = $4500 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 5%

This, means, $5 per $100 per year

∵ For $100, the simple interest for 1 year = $5

∴ For $1, the simple interest for 1 year = ⁵/₁₀₀

∴ For $3600, the simple interest in 1 year

= ⁵/₁₀₀ × 3600

= ^{5 × 3600}/₁₀₀

= ¹⁸⁰⁰⁰/₁₀₀ = $180

Thus, simple interest for 1 year = $180

Therefore, simple interest for 5 years

= Simple interest for 1 year × 5

= $180 × 5 = $900

Thus, Simple Interest (SI) = $900

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3600 + $900

= $4500

Thus, Amount to be paid = $4500 Answer

Similar Questions

(1) Nancy had to pay $4648 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(2) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 10% simple interest?

(3) If Joshua paid $5684 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 Charles have to pay after 5 years if he takes a loan of $3900 at 6% simple interest?

(5) If Karen borrowed $3950 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(6) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 5% simple interest.

(7) What amount does John have to pay after 5 years if he takes a loan of $3200 at 9% simple interest?

(8) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 4% simple interest.

(9) James took a loan of $4000 at the rate of 6% simple interest per annum. If he paid an amount of $5920 to clear the loan, then find the time period of the loan.

(10) Sarah took a loan of $5700 at the rate of 6% simple interest per annum. If he paid an amount of $8778 to clear the loan, then find the time period of the loan.