Simple Interest
Math MCQs

Question :    Find the amount to be paid if Patricia borrowed a sum of $5150 at 2% simple interest for 7 years.

Correct Answer  $5871

Solution & Explanation

Solution

Given,

Principal (P) = $5150

Rate of Simple Interest (SI) = 2%

Time (t) = 7 years

Thus, Amount (A) = ?

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

Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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) = $5150 × 2% × 7

= $5150 ײ/₁₀₀ × 7

= ^{5150 × 2 × 7}/₁₀₀

= ^{10300 × 7}/₁₀₀

= ⁷²¹⁰⁰/₁₀₀

= $721

Thus, Simple Interest = $721

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 = $5150 + $721

= $5871

Thus, Amount to be paid = $5871 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 = $5150

Rate of Simple Interest (SI) or (R) = 2%

And, Time (t) = 7 years

Thus, Amount (A)

= $5150 + ($5150 × 2% × 7)

= $5150 + ($5150 ײ/₁₀₀ × 7)

= $5150 + (^{5150 × 2 × 7}/₁₀₀)

= $5150 + (^{10300 × 7}/₁₀₀)

= $5150 + (⁷²¹⁰⁰/₁₀₀)

= $5150 + $721 = $5871

Thus, Amount (A) to be paid = $5871 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 2%

This, means, $2 per $100 per year

∵ For $100, the simple interest for 1 year = $2

∴ For $1, the simple interest for 1 year = ²/₁₀₀

∴ For $5150, the simple interest in 1 year

= ²/₁₀₀ × 5150

= ^{2 × 5150}/₁₀₀

= ¹⁰³⁰⁰/₁₀₀ = $103

Thus, simple interest for 1 year = $103

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $103 × 7 = $721

Thus, Simple Interest (SI) = $721

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5150 + $721

= $5871

Thus, Amount to be paid = $5871 Answer

Similar Questions

(1) If Thomas paid $4256 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(2) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 9% simple interest?

(3) Calculate the amount due if John borrowed a sum of $3200 at 3% simple interest for 4 years.

(4) Michael took a loan of $4600 at the rate of 8% simple interest per annum. If he paid an amount of $7912 to clear the loan, then find the time period of the loan.

(5) What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 8% simple interest?

(6) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 6% simple interest.

(7) In how much time a principal of $3100 will amount to $3720 at a simple interest of 4% per annum?

(8) Robert had to pay $3565 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(9) Calculate the amount due if Jennifer borrowed a sum of $3250 at 4% simple interest for 3 years.

(10) What amount will be due after 2 years if Paul borrowed a sum of $3850 at a 8% simple interest?