Simple Interest
Math MCQs

Question :    What amount does Joseph have to pay after 5 years if he takes a loan of $3700 at 6% simple interest?

Correct Answer  $4810

Solution & Explanation

Solution

Given,

Principal (P) = $3700

Rate of Simple Interest (SI) = 6%

Time (t) = 5 years

Thus, Amount (A) = ?

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

Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $3700 × 6% × 5

= $3700 ×⁶/₁₀₀ × 5

= ^{3700 × 6 × 5}/₁₀₀

= ^{22200 × 5}/₁₀₀

= ¹¹¹⁰⁰⁰/₁₀₀

= $1110

Thus, Simple Interest = $1110

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 = $3700 + $1110

= $4810

Thus, Amount to be paid = $4810 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 = $3700

Rate of Simple Interest (SI) or (R) = 6%

And, Time (t) = 5 years

Thus, Amount (A)

= $3700 + ($3700 × 6% × 5)

= $3700 + ($3700 ×⁶/₁₀₀ × 5)

= $3700 + (^{3700 × 6 × 5}/₁₀₀)

= $3700 + (^{22200 × 5}/₁₀₀)

= $3700 + (¹¹¹⁰⁰⁰/₁₀₀)

= $3700 + $1110 = $4810

Thus, Amount (A) to be paid = $4810 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 6%

This, means, $6 per $100 per year

∵ For $100, the simple interest for 1 year = $6

∴ For $1, the simple interest for 1 year = ⁶/₁₀₀

∴ For $3700, the simple interest in 1 year

= ⁶/₁₀₀ × 3700

= ^{6 × 3700}/₁₀₀

= ²²²⁰⁰/₁₀₀ = $222

Thus, simple interest for 1 year = $222

Therefore, simple interest for 5 years

= Simple interest for 1 year × 5

= $222 × 5 = $1110

Thus, Simple Interest (SI) = $1110

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3700 + $1110

= $4810

Thus, Amount to be paid = $4810 Answer

Similar Questions

(1) Calculate the amount due after 10 years if James borrowed a sum of $5000 at a rate of 8% simple interest.

(2) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.

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

(4) If Ashley paid $5096 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(5) What amount will be due after 2 years if Joshua borrowed a sum of $3950 at a 5% simple interest?

(6) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 9% simple interest for 8 years.

(7) Robert had to pay $3565 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(8) What amount does James have to pay after 5 years if he takes a loan of $3000 at 4% simple interest?

(9) Karen took a loan of $5900 at the rate of 10% simple interest per annum. If he paid an amount of $10620 to clear the loan, then find the time period of the loan.

(10) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 5% simple interest?