Simple Interest
Math MCQs

Question :    What amount does Jessica have to pay after 5 years if he takes a loan of $3750 at 6% simple interest?

Correct Answer  $4875

Solution & Explanation

Solution

Given,

Principal (P) = $3750

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) = $3750 × 6% × 5

= $3750 ×⁶/₁₀₀ × 5

= ^{3750 × 6 × 5}/₁₀₀

= ^{22500 × 5}/₁₀₀

= ¹¹²⁵⁰⁰/₁₀₀

= $1125

Thus, Simple Interest = $1125

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 = $3750 + $1125

= $4875

Thus, Amount to be paid = $4875 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 = $3750

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

And, Time (t) = 5 years

Thus, Amount (A)

= $3750 + ($3750 × 6% × 5)

= $3750 + ($3750 ×⁶/₁₀₀ × 5)

= $3750 + (^{3750 × 6 × 5}/₁₀₀)

= $3750 + (^{22500 × 5}/₁₀₀)

= $3750 + (¹¹²⁵⁰⁰/₁₀₀)

= $3750 + $1125 = $4875

Thus, Amount (A) to be paid = $4875 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 $3750, the simple interest in 1 year

= ⁶/₁₀₀ × 3750

= ^{6 × 3750}/₁₀₀

= ²²⁵⁰⁰/₁₀₀ = $225

Thus, simple interest for 1 year = $225

Therefore, simple interest for 5 years

= Simple interest for 1 year × 5

= $225 × 5 = $1125

Thus, Simple Interest (SI) = $1125

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3750 + $1125

= $4875

Thus, Amount to be paid = $4875 Answer

Similar Questions

(1) Find the amount to be paid if James borrowed a sum of $5000 at 10% simple interest for 8 years.

(2) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 3% simple interest.

(3) Elizabeth had to pay $3864 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(4) Mary took a loan of $4100 at the rate of 10% simple interest per annum. If he paid an amount of $6970 to clear the loan, then find the time period of the loan.

(5) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $11316 to clear the loan, then find the time period of the loan.

(6) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 9% simple interest for 7 years.

(7) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 2% simple interest?

(8) What amount does Joseph have to pay after 5 years if he takes a loan of $3700 at 8% simple interest?

(9) What amount will be due after 2 years if David borrowed a sum of $3200 at a 6% simple interest?

(10) Lisa took a loan of $6100 at the rate of 8% simple interest per annum. If he paid an amount of $9516 to clear the loan, then find the time period of the loan.