Simple Interest
Math MCQs

Question :    What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 3% simple interest?

Correct Answer  $4602

Solution & Explanation

Solution

Given,

Principal (P) = $3900

Rate of Simple Interest (SI) = 3%

Time (t) = 6 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) = $3900 × 3% × 6

= $3900 ׳/₁₀₀ × 6

= ^{3900 × 3 × 6}/₁₀₀

= ^{11700 × 6}/₁₀₀

= ⁷⁰²⁰⁰/₁₀₀

= $702

Thus, Simple Interest = $702

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 = $3900 + $702

= $4602

Thus, Amount to be paid = $4602 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 = $3900

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

And, Time (t) = 6 years

Thus, Amount (A)

= $3900 + ($3900 × 3% × 6)

= $3900 + ($3900 ׳/₁₀₀ × 6)

= $3900 + (^{3900 × 3 × 6}/₁₀₀)

= $3900 + (^{11700 × 6}/₁₀₀)

= $3900 + (⁷⁰²⁰⁰/₁₀₀)

= $3900 + $702 = $4602

Thus, Amount (A) to be paid = $4602 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 $3900, the simple interest in 1 year

= ³/₁₀₀ × 3900

= ^{3 × 3900}/₁₀₀

= ¹¹⁷⁰⁰/₁₀₀ = $117

Thus, simple interest for 1 year = $117

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $117 × 6 = $702

Thus, Simple Interest (SI) = $702

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3900 + $702

= $4602

Thus, Amount to be paid = $4602 Answer

Similar Questions

(1) If Anthony paid $5160 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(2) How much loan did Christopher borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7200 to clear it?

(3) Daniel took a loan of $6200 at the rate of 10% simple interest per annum. If he paid an amount of $11160 to clear the loan, then find the time period of the loan.

(4) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 4% simple interest?

(5) Find the amount to be paid if Charles borrowed a sum of $5900 at 9% simple interest for 8 years.

(6) Calculate the amount due if David borrowed a sum of $3400 at 9% simple interest for 4 years.

(7) Linda took a loan of $4700 at the rate of 9% simple interest per annum. If he paid an amount of $8084 to clear the loan, then find the time period of the loan.

(8) Calculate the amount due if James borrowed a sum of $3000 at 8% simple interest for 3 years.

(9) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7980 to clear it?

(10) Find the amount to be paid if Karen borrowed a sum of $5950 at 8% simple interest for 8 years.