Simple Interest
Math MCQs

Question :    Find the amount to be paid if Susan borrowed a sum of $5650 at 4% simple interest for 7 years.

Correct Answer  $7232

Solution & Explanation

Solution

Given,

Principal (P) = $5650

Rate of Simple Interest (SI) = 4%

Time (t) = 7 years

Thus, Amount (A) = ?

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

Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $5650 × 4% × 7

= $5650 ×⁴/₁₀₀ × 7

= ^{5650 × 4 × 7}/₁₀₀

= ^{22600 × 7}/₁₀₀

= ¹⁵⁸²⁰⁰/₁₀₀

= $1582

Thus, Simple Interest = $1582

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 = $5650 + $1582

= $7232

Thus, Amount to be paid = $7232 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 = $5650

Rate of Simple Interest (SI) or (R) = 4%

And, Time (t) = 7 years

Thus, Amount (A)

= $5650 + ($5650 × 4% × 7)

= $5650 + ($5650 ×⁴/₁₀₀ × 7)

= $5650 + (^{5650 × 4 × 7}/₁₀₀)

= $5650 + (^{22600 × 7}/₁₀₀)

= $5650 + (¹⁵⁸²⁰⁰/₁₀₀)

= $5650 + $1582 = $7232

Thus, Amount (A) to be paid = $7232 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 4%

This, means, $4 per $100 per year

∵ For $100, the simple interest for 1 year = $4

∴ For $1, the simple interest for 1 year = ⁴/₁₀₀

∴ For $5650, the simple interest in 1 year

= ⁴/₁₀₀ × 5650

= ^{4 × 5650}/₁₀₀

= ²²⁶⁰⁰/₁₀₀ = $226

Thus, simple interest for 1 year = $226

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $226 × 7 = $1582

Thus, Simple Interest (SI) = $1582

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5650 + $1582

= $7232

Thus, Amount to be paid = $7232 Answer

Similar Questions

(1) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 4% simple interest.

(2) Charles took a loan of $5800 at the rate of 9% simple interest per annum. If he paid an amount of $10498 to clear the loan, then find the time period of the loan.

(3) Find the amount to be paid if Christopher borrowed a sum of $6000 at 10% simple interest for 8 years.

(4) Margaret took a loan of $6700 at the rate of 6% simple interest per annum. If he paid an amount of $9112 to clear the loan, then find the time period of the loan.

(5) Find the amount to be paid if Jessica borrowed a sum of $5750 at 4% simple interest for 7 years.

(6) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $12420 to clear the loan, then find the time period of the loan.

(7) John took a loan of $4400 at the rate of 9% simple interest per annum. If he paid an amount of $8360 to clear the loan, then find the time period of the loan.

(8) How much loan did Betty borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7500 to clear it?

(9) If Mary borrowed $3050 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(10) Calculate the amount due if David borrowed a sum of $3400 at 9% simple interest for 3 years.