Simple Interest
Math MCQs

Question :    What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 10% simple interest?

Correct Answer  $5700

Solution & Explanation

Solution

Given,

Principal (P) = $3800

Rate of Simple Interest (SI) = 10%

Time (t) = 5 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% × 5

= $3800 ×¹⁰/₁₀₀ × 5

= ^{3800 × 10 × 5}/₁₀₀

= ^{38000 × 5}/₁₀₀

= ¹⁹⁰⁰⁰⁰/₁₀₀

= $1900

Thus, Simple Interest = $1900

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 + $1900

= $5700

Thus, Amount to be paid = $5700 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) = 5 years

Thus, Amount (A)

= $3800 + ($3800 × 10% × 5)

= $3800 + ($3800 ×¹⁰/₁₀₀ × 5)

= $3800 + (^{3800 × 10 × 5}/₁₀₀)

= $3800 + (^{38000 × 5}/₁₀₀)

= $3800 + (¹⁹⁰⁰⁰⁰/₁₀₀)

= $3800 + $1900 = $5700

Thus, Amount (A) to be paid = $5700 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 5 years

= Simple interest for 1 year × 5

= $380 × 5 = $1900

Thus, Simple Interest (SI) = $1900

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3800 + $1900

= $5700

Thus, Amount to be paid = $5700 Answer

Similar Questions

(1) How much loan did Richard borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6440 to clear it?

(2) How much loan did Ronald borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8625 to clear it?

(3) In how much time a principal of $3050 will amount to $3660 at a simple interest of 4% per annum?

(4) Calculate the amount due if Christopher borrowed a sum of $4000 at 7% simple interest for 3 years.

(5) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 5% simple interest.

(6) If Michelle paid $5940 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(7) Find the amount to be paid if Thomas borrowed a sum of $5800 at 6% simple interest for 7 years.

(8) What amount will be due after 2 years if James borrowed a sum of $3000 at a 6% simple interest?

(9) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 5% simple interest for 3 years.

(10) Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $7020 to clear the loan, then find the time period of the loan.