Simple Interest
Math MCQs

Question :    What amount does John have to pay after 6 years if he takes a loan of $3200 at 5% simple interest?

Correct Answer  $4160

Solution & Explanation

Solution

Given,

Principal (P) = $3200

Rate of Simple Interest (SI) = 5%

Time (t) = 6 years

Thus, Amount (A) = ?

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

Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $3200 × 5% × 6

= $3200 ×⁵/₁₀₀ × 6

= ^{3200 × 5 × 6}/₁₀₀

= ^{16000 × 6}/₁₀₀

= ⁹⁶⁰⁰⁰/₁₀₀

= $960

Thus, Simple Interest = $960

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 = $3200 + $960

= $4160

Thus, Amount to be paid = $4160 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 = $3200

Rate of Simple Interest (SI) or (R) = 5%

And, Time (t) = 6 years

Thus, Amount (A)

= $3200 + ($3200 × 5% × 6)

= $3200 + ($3200 ×⁵/₁₀₀ × 6)

= $3200 + (^{3200 × 5 × 6}/₁₀₀)

= $3200 + (^{16000 × 6}/₁₀₀)

= $3200 + (⁹⁶⁰⁰⁰/₁₀₀)

= $3200 + $960 = $4160

Thus, Amount (A) to be paid = $4160 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 5%

This, means, $5 per $100 per year

∵ For $100, the simple interest for 1 year = $5

∴ For $1, the simple interest for 1 year = ⁵/₁₀₀

∴ For $3200, the simple interest in 1 year

= ⁵/₁₀₀ × 3200

= ^{5 × 3200}/₁₀₀

= ¹⁶⁰⁰⁰/₁₀₀ = $160

Thus, simple interest for 1 year = $160

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $160 × 6 = $960

Thus, Simple Interest (SI) = $960

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3200 + $960

= $4160

Thus, Amount to be paid = $4160 Answer

Similar Questions

(1) If Jessica borrowed $3750 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(2) How much loan did Kevin borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8165 to clear it?

(3) Margaret took a loan of $6700 at the rate of 9% simple interest per annum. If he paid an amount of $12730 to clear the loan, then find the time period of the loan.

(4) In how much time a principal of $3050 will amount to $3233 at a simple interest of 3% per annum?

(5) William took a loan of $5000 at the rate of 7% simple interest per annum. If he paid an amount of $7450 to clear the loan, then find the time period of the loan.

(6) Nancy took a loan of $6300 at the rate of 10% simple interest per annum. If he paid an amount of $11340 to clear the loan, then find the time period of the loan.

(7) How much loan did Anthony borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7245 to clear it?

(8) Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 6% simple interest.

(9) What amount does Joseph have to pay after 5 years if he takes a loan of $3700 at 7% simple interest?

(10) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 4% simple interest.