Simple Interest
Math MCQs

Question :    What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 7% simple interest?

Correct Answer  $5041

Solution & Explanation

Solution

Given,

Principal (P) = $3550

Rate of Simple Interest (SI) = 7%

Time (t) = 6 years

Thus, Amount (A) = ?

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

Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $3550 × 7% × 6

= $3550 ×⁷/₁₀₀ × 6

= ^{3550 × 7 × 6}/₁₀₀

= ^{24850 × 6}/₁₀₀

= ¹⁴⁹¹⁰⁰/₁₀₀

= $1491

Thus, Simple Interest = $1491

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 = $3550 + $1491

= $5041

Thus, Amount to be paid = $5041 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 = $3550

Rate of Simple Interest (SI) or (R) = 7%

And, Time (t) = 6 years

Thus, Amount (A)

= $3550 + ($3550 × 7% × 6)

= $3550 + ($3550 ×⁷/₁₀₀ × 6)

= $3550 + (^{3550 × 7 × 6}/₁₀₀)

= $3550 + (^{24850 × 6}/₁₀₀)

= $3550 + (¹⁴⁹¹⁰⁰/₁₀₀)

= $3550 + $1491 = $5041

Thus, Amount (A) to be paid = $5041 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 7%

This, means, $7 per $100 per year

∵ For $100, the simple interest for 1 year = $7

∴ For $1, the simple interest for 1 year = ⁷/₁₀₀

∴ For $3550, the simple interest in 1 year

= ⁷/₁₀₀ × 3550

= ^{7 × 3550}/₁₀₀

= ²⁴⁸⁵⁰/₁₀₀ = $248.5

Thus, simple interest for 1 year = $248.5

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $248.5 × 6 = $1491

Thus, Simple Interest (SI) = $1491

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3550 + $1491

= $5041

Thus, Amount to be paid = $5041 Answer

Similar Questions

(1) Calculate the amount due if William borrowed a sum of $3500 at 2% simple interest for 4 years.

(2) What amount does Patricia have to pay after 5 years if he takes a loan of $3150 at 4% simple interest?

(3) 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?

(4) Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $7650 to clear the loan, then find the time period of the loan.

(5) Sarah took a loan of $5700 at the rate of 7% simple interest per annum. If he paid an amount of $8892 to clear the loan, then find the time period of the loan.

(6) How much loan did Paul borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8375 to clear it?

(7) How much loan did Ronald borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9000 to clear it?

(8) Find the amount to be paid if Karen borrowed a sum of $5950 at 6% simple interest for 8 years.

(9) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 4% simple interest?

(10) Find the amount to be paid if Michael borrowed a sum of $5300 at 2% simple interest for 8 years.