Simple Interest
Math MCQs

Question :    What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 10% simple interest?

Correct Answer  $5920

Solution & Explanation

Solution

Given,

Principal (P) = $3700

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) = $3700 × 10% × 6

= $3700 ×¹⁰/₁₀₀ × 6

= ^{3700 × 10 × 6}/₁₀₀

= ^{37000 × 6}/₁₀₀

= ²²²⁰⁰⁰/₁₀₀

= $2220

Thus, Simple Interest = $2220

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 = $3700 + $2220

= $5920

Thus, Amount to be paid = $5920 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 = $3700

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

And, Time (t) = 6 years

Thus, Amount (A)

= $3700 + ($3700 × 10% × 6)

= $3700 + ($3700 ×¹⁰/₁₀₀ × 6)

= $3700 + (^{3700 × 10 × 6}/₁₀₀)

= $3700 + (^{37000 × 6}/₁₀₀)

= $3700 + (²²²⁰⁰⁰/₁₀₀)

= $3700 + $2220 = $5920

Thus, Amount (A) to be paid = $5920 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 $3700, the simple interest in 1 year

= ¹⁰/₁₀₀ × 3700

= ^{10 × 3700}/₁₀₀

= ³⁷⁰⁰⁰/₁₀₀ = $370

Thus, simple interest for 1 year = $370

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $370 × 6 = $2220

Thus, Simple Interest (SI) = $2220

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3700 + $2220

= $5920

Thus, Amount to be paid = $5920 Answer

Similar Questions

(1) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 3% simple interest?

(2) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 8% simple interest for 3 years.

(3) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 6% simple interest.

(4) How much loan did Karen borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6545 to clear it?

(5) Calculate the amount due if Patricia borrowed a sum of $3150 at 5% simple interest for 3 years.

(6) Jennifer took a loan of $4500 at the rate of 6% simple interest per annum. If he paid an amount of $6930 to clear the loan, then find the time period of the loan.

(7) Find the amount to be paid if Susan borrowed a sum of $5650 at 3% simple interest for 8 years.

(8) Find the amount to be paid if Michael borrowed a sum of $5300 at 9% simple interest for 8 years.

(9) Sarah took a loan of $5700 at the rate of 10% simple interest per annum. If he paid an amount of $10260 to clear the loan, then find the time period of the loan.

(10) Calculate the amount due if Robert borrowed a sum of $3100 at 6% simple interest for 3 years.