Simple Interest
Math MCQs

Question :    What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 10% simple interest?

Correct Answer  $6320

Solution & Explanation

Solution

Given,

Principal (P) = $3950

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) = $3950 × 10% × 6

= $3950 ×¹⁰/₁₀₀ × 6

= ^{3950 × 10 × 6}/₁₀₀

= ^{39500 × 6}/₁₀₀

= ²³⁷⁰⁰⁰/₁₀₀

= $2370

Thus, Simple Interest = $2370

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 = $3950 + $2370

= $6320

Thus, Amount to be paid = $6320 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 = $3950

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

And, Time (t) = 6 years

Thus, Amount (A)

= $3950 + ($3950 × 10% × 6)

= $3950 + ($3950 ×¹⁰/₁₀₀ × 6)

= $3950 + (^{3950 × 10 × 6}/₁₀₀)

= $3950 + (^{39500 × 6}/₁₀₀)

= $3950 + (²³⁷⁰⁰⁰/₁₀₀)

= $3950 + $2370 = $6320

Thus, Amount (A) to be paid = $6320 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 $3950, the simple interest in 1 year

= ¹⁰/₁₀₀ × 3950

= ^{10 × 3950}/₁₀₀

= ³⁹⁵⁰⁰/₁₀₀ = $395

Thus, simple interest for 1 year = $395

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $395 × 6 = $2370

Thus, Simple Interest (SI) = $2370

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3950 + $2370

= $6320

Thus, Amount to be paid = $6320 Answer

Similar Questions

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

(2) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 9% simple interest.

(3) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 2% simple interest.

(4) Charles took a loan of $5800 at the rate of 7% simple interest per annum. If he paid an amount of $8236 to clear the loan, then find the time period of the loan.

(5) Elizabeth took a loan of $4900 at the rate of 7% simple interest per annum. If he paid an amount of $7987 to clear the loan, then find the time period of the loan.

(6) Calculate the amount due if Charles borrowed a sum of $3900 at 10% simple interest for 3 years.

(7) Find the amount to be paid if William borrowed a sum of $5500 at 6% simple interest for 7 years.

(8) Donald took a loan of $7000 at the rate of 7% simple interest per annum. If he paid an amount of $10920 to clear the loan, then find the time period of the loan.

(9) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 6% simple interest?

(10) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 6% simple interest.