Simple Interest
Math MCQs

Question :    What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 10% simple interest?

Correct Answer  $5280

Solution & Explanation

Solution

Given,

Principal (P) = $3300

Rate of Simple Interest (SI) = 10%

Time (t) = 6 years

Thus, Amount (A) = ?

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

Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $3300 × 10% × 6

= $3300 ×¹⁰/₁₀₀ × 6

= ^{3300 × 10 × 6}/₁₀₀

= ^{33000 × 6}/₁₀₀

= ¹⁹⁸⁰⁰⁰/₁₀₀

= $1980

Thus, Simple Interest = $1980

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 = $3300 + $1980

= $5280

Thus, Amount to be paid = $5280 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 = $3300

Rate of Simple Interest (SI) or (R) = 10%

And, Time (t) = 6 years

Thus, Amount (A)

= $3300 + ($3300 × 10% × 6)

= $3300 + ($3300 ×¹⁰/₁₀₀ × 6)

= $3300 + (^{3300 × 10 × 6}/₁₀₀)

= $3300 + (^{33000 × 6}/₁₀₀)

= $3300 + (¹⁹⁸⁰⁰⁰/₁₀₀)

= $3300 + $1980 = $5280

Thus, Amount (A) to be paid = $5280 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 10%

This, means, $10 per $100 per year

∵ For $100, the simple interest for 1 year = $10

∴ For $1, the simple interest for 1 year = ¹⁰/₁₀₀

∴ For $3300, the simple interest in 1 year

= ¹⁰/₁₀₀ × 3300

= ^{10 × 3300}/₁₀₀

= ³³⁰⁰⁰/₁₀₀ = $330

Thus, simple interest for 1 year = $330

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $330 × 6 = $1980

Thus, Simple Interest (SI) = $1980

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3300 + $1980

= $5280

Thus, Amount to be paid = $5280 Answer

Similar Questions

(1) How much loan did Kevin borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8520 to clear it?

(2) Find the amount to be paid if Joseph borrowed a sum of $5700 at 10% simple interest for 7 years.

(3) Patricia took a loan of $4300 at the rate of 8% simple interest per annum. If he paid an amount of $6708 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 2% simple interest for 7 years.

(5) If Joseph paid $4440 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(6) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 9% simple interest for 8 years.

(7) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 10% simple interest for 8 years.

(8) If Nancy paid $4482 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(9) If Sarah borrowed $3850 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(10) How much loan did Cynthia borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9540 to clear it?