Simple Interest
Math MCQs

Question :    What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 7% simple interest?

Correct Answer  $5538

Solution & Explanation

Solution

Given,

Principal (P) = $3900

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) = $3900 × 7% × 6

= $3900 ×⁷/₁₀₀ × 6

= ^{3900 × 7 × 6}/₁₀₀

= ^{27300 × 6}/₁₀₀

= ¹⁶³⁸⁰⁰/₁₀₀

= $1638

Thus, Simple Interest = $1638

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 + $1638

= $5538

Thus, Amount to be paid = $5538 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) = 7%

And, Time (t) = 6 years

Thus, Amount (A)

= $3900 + ($3900 × 7% × 6)

= $3900 + ($3900 ×⁷/₁₀₀ × 6)

= $3900 + (^{3900 × 7 × 6}/₁₀₀)

= $3900 + (^{27300 × 6}/₁₀₀)

= $3900 + (¹⁶³⁸⁰⁰/₁₀₀)

= $3900 + $1638 = $5538

Thus, Amount (A) to be paid = $5538 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 $3900, the simple interest in 1 year

= ⁷/₁₀₀ × 3900

= ^{7 × 3900}/₁₀₀

= ²⁷³⁰⁰/₁₀₀ = $273

Thus, simple interest for 1 year = $273

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $273 × 6 = $1638

Thus, Simple Interest (SI) = $1638

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3900 + $1638

= $5538

Thus, Amount to be paid = $5538 Answer

Similar Questions

(1) Calculate the amount due after 9 years if Barbara borrowed a sum of $5550 at a rate of 3% simple interest.

(2) Find the amount to be paid if Mary borrowed a sum of $5050 at 7% simple interest for 8 years.

(3) James took a loan of $4000 at the rate of 7% simple interest per annum. If he paid an amount of $5680 to clear the loan, then find the time period of the loan.

(4) Find the amount to be paid if David borrowed a sum of $5400 at 9% simple interest for 8 years.

(5) Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $8800 to clear the loan, then find the time period of the loan.

(6) What amount does David have to pay after 6 years if he takes a loan of $3400 at 2% simple interest?

(7) If Susan paid $4380 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(8) Jennifer took a loan of $4500 at the rate of 6% simple interest per annum. If he paid an amount of $6120 to clear the loan, then find the time period of the loan.

(9) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 10% simple interest?

(10) How much loan did Joseph borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7125 to clear it?