Simple Interest
Math MCQs

Question :    What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 8% simple interest?

Correct Answer  $4514

Solution & Explanation

Solution

Given,

Principal (P) = $3050

Rate of Simple Interest (SI) = 8%

Time (t) = 6 years

Thus, Amount (A) = ?

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

Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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 × 8% × 6

= $3050 ×⁸/₁₀₀ × 6

= ^{3050 × 8 × 6}/₁₀₀

= ^{24400 × 6}/₁₀₀

= ¹⁴⁶⁴⁰⁰/₁₀₀

= $1464

Thus, Simple Interest = $1464

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 + $1464

= $4514

Thus, Amount to be paid = $4514 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) = 8%

And, Time (t) = 6 years

Thus, Amount (A)

= $3050 + ($3050 × 8% × 6)

= $3050 + ($3050 ×⁸/₁₀₀ × 6)

= $3050 + (^{3050 × 8 × 6}/₁₀₀)

= $3050 + (^{24400 × 6}/₁₀₀)

= $3050 + (¹⁴⁶⁴⁰⁰/₁₀₀)

= $3050 + $1464 = $4514

Thus, Amount (A) to be paid = $4514 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 8%

This, means, $8 per $100 per year

∵ For $100, the simple interest for 1 year = $8

∴ For $1, the simple interest for 1 year = ⁸/₁₀₀

∴ For $3050, the simple interest in 1 year

= ⁸/₁₀₀ × 3050

= ^{8 × 3050}/₁₀₀

= ²⁴⁴⁰⁰/₁₀₀ = $244

Thus, simple interest for 1 year = $244

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $244 × 6 = $1464

Thus, Simple Interest (SI) = $1464

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3050 + $1464

= $4514

Thus, Amount to be paid = $4514 Answer

Similar Questions

(1) How much loan did Sarah borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7312.5 to clear it?

(2) Find the amount to be paid if Richard borrowed a sum of $5600 at 3% simple interest for 8 years.

(3) Calculate the amount due if Susan borrowed a sum of $3650 at 5% simple interest for 3 years.

(4) In how much time a principal of $3100 will amount to $3472 at a simple interest of 3% per annum?

(5) What amount does William have to pay after 5 years if he takes a loan of $3500 at 9% simple interest?

(6) Calculate the amount due if Christopher borrowed a sum of $4000 at 2% simple interest for 4 years.

(7) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 3% simple interest.

(8) Michael had to pay $3498 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(9) Find the amount to be paid if Susan borrowed a sum of $5650 at 4% simple interest for 7 years.

(10) If Joseph paid $4144 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.