Simple Interest
Math MCQs

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

Correct Answer  $6498

Solution & Explanation

Solution

Given,

Principal (P) = $5700

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) = $5700 × 2% × 7

= $5700 ײ/₁₀₀ × 7

= ^{5700 × 2 × 7}/₁₀₀

= ^{11400 × 7}/₁₀₀

= ⁷⁹⁸⁰⁰/₁₀₀

= $798

Thus, Simple Interest = $798

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 = $5700 + $798

= $6498

Thus, Amount to be paid = $6498 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 = $5700

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

And, Time (t) = 7 years

Thus, Amount (A)

= $5700 + ($5700 × 2% × 7)

= $5700 + ($5700 ײ/₁₀₀ × 7)

= $5700 + (^{5700 × 2 × 7}/₁₀₀)

= $5700 + (^{11400 × 7}/₁₀₀)

= $5700 + (⁷⁹⁸⁰⁰/₁₀₀)

= $5700 + $798 = $6498

Thus, Amount (A) to be paid = $6498 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 $5700, the simple interest in 1 year

= ²/₁₀₀ × 5700

= ^{2 × 5700}/₁₀₀

= ¹¹⁴⁰⁰/₁₀₀ = $114

Thus, simple interest for 1 year = $114

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $114 × 7 = $798

Thus, Simple Interest (SI) = $798

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5700 + $798

= $6498

Thus, Amount to be paid = $6498 Answer

Similar Questions

(1) In how much time a principal of $3000 will amount to $3240 at a simple interest of 2% per annum?

(2) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 2% simple interest?

(3) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $8364 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due if Robert borrowed a sum of $3100 at 4% simple interest for 3 years.

(5) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 8% simple interest.

(6) Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $11247 to clear the loan, then find the time period of the loan.

(7) In how much time a principal of $3100 will amount to $3875 at a simple interest of 5% per annum?

(8) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 10% simple interest.

(9) What amount will be due after 2 years if William borrowed a sum of $3250 at a 10% simple interest?

(10) What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 10% simple interest?