Simple Interest
Math MCQs

Question :    What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 4% simple interest?

Correct Answer  $3782

Solution & Explanation

Solution

Given,

Principal (P) = $3050

Rate of Simple Interest (SI) = 4%

Time (t) = 6 years

Thus, Amount (A) = ?

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

Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $3050 × 4% × 6

= $3050 ×⁴/₁₀₀ × 6

= ^{3050 × 4 × 6}/₁₀₀

= ^{12200 × 6}/₁₀₀

= ⁷³²⁰⁰/₁₀₀

= $732

Thus, Simple Interest = $732

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 = $3050 + $732

= $3782

Thus, Amount to be paid = $3782 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 = $3050

Rate of Simple Interest (SI) or (R) = 4%

And, Time (t) = 6 years

Thus, Amount (A)

= $3050 + ($3050 × 4% × 6)

= $3050 + ($3050 ×⁴/₁₀₀ × 6)

= $3050 + (^{3050 × 4 × 6}/₁₀₀)

= $3050 + (^{12200 × 6}/₁₀₀)

= $3050 + (⁷³²⁰⁰/₁₀₀)

= $3050 + $732 = $3782

Thus, Amount (A) to be paid = $3782 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 4%

This, means, $4 per $100 per year

∵ For $100, the simple interest for 1 year = $4

∴ For $1, the simple interest for 1 year = ⁴/₁₀₀

∴ For $3050, the simple interest in 1 year

= ⁴/₁₀₀ × 3050

= ^{4 × 3050}/₁₀₀

= ¹²²⁰⁰/₁₀₀ = $122

Thus, simple interest for 1 year = $122

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $122 × 6 = $732

Thus, Simple Interest (SI) = $732

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3050 + $732

= $3782

Thus, Amount to be paid = $3782 Answer

Similar Questions

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

(2) In how much time a principal of $3100 will amount to $3596 at a simple interest of 4% per annum?

(3) Calculate the amount due if Thomas borrowed a sum of $3800 at 4% simple interest for 3 years.

(4) Patricia took a loan of $4300 at the rate of 7% simple interest per annum. If he paid an amount of $6407 to clear the loan, then find the time period of the loan.

(5) Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $11247 to clear the loan, then find the time period of the loan.

(6) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $8360 to clear the loan, then find the time period of the loan.

(7) David took a loan of $4800 at the rate of 10% simple interest per annum. If he paid an amount of $9120 to clear the loan, then find the time period of the loan.

(8) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $9310 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due if James borrowed a sum of $3000 at 8% simple interest for 4 years.

(10) Find the amount to be paid if Mary borrowed a sum of $5050 at 10% simple interest for 7 years.