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) Find the amount to be paid if Christopher borrowed a sum of $6000 at 6% simple interest for 8 years.

(2) If Patricia paid $3654 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(3) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 4% simple interest?

(4) How much loan did Edward borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9500 to clear it?

(5) Find the amount to be paid if Robert borrowed a sum of $5100 at 6% simple interest for 7 years.

(6) Find the amount to be paid if Joseph borrowed a sum of $5700 at 3% simple interest for 7 years.

(7) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 9% simple interest.

(8) How much loan did Robert borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5610 to clear it?

(9) If Steven paid $4968 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(10) Paul had to pay $4982 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.