Simple Interest
Math MCQs

Question :    Find the amount to be paid if Christopher borrowed a sum of $6000 at 4% simple interest for 7 years.

Correct Answer  $7680

Solution & Explanation

Solution

Given,

Principal (P) = $6000

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) = $6000 × 4% × 7

= $6000 ×⁴/₁₀₀ × 7

= ^{6000 × 4 × 7}/₁₀₀

= ^{24000 × 7}/₁₀₀

= ¹⁶⁸⁰⁰⁰/₁₀₀

= $1680

Thus, Simple Interest = $1680

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 = $6000 + $1680

= $7680

Thus, Amount to be paid = $7680 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 = $6000

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

And, Time (t) = 7 years

Thus, Amount (A)

= $6000 + ($6000 × 4% × 7)

= $6000 + ($6000 ×⁴/₁₀₀ × 7)

= $6000 + (^{6000 × 4 × 7}/₁₀₀)

= $6000 + (^{24000 × 7}/₁₀₀)

= $6000 + (¹⁶⁸⁰⁰⁰/₁₀₀)

= $6000 + $1680 = $7680

Thus, Amount (A) to be paid = $7680 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 $6000, the simple interest in 1 year

= ⁴/₁₀₀ × 6000

= ^{4 × 6000}/₁₀₀

= ²⁴⁰⁰⁰/₁₀₀ = $240

Thus, simple interest for 1 year = $240

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $240 × 7 = $1680

Thus, Simple Interest (SI) = $1680

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $6000 + $1680

= $7680

Thus, Amount to be paid = $7680 Answer

Similar Questions

(1) In how much time a principal of $3200 will amount to $3712 at a simple interest of 4% per annum?

(2) Michael took a loan of $4600 at the rate of 8% simple interest per annum. If he paid an amount of $7176 to clear the loan, then find the time period of the loan.

(3) If Barbara paid $4118 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(4) Calculate the amount due if Michael borrowed a sum of $3300 at 8% simple interest for 4 years.

(5) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 10% simple interest?

(6) How much loan did Richard borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6440 to clear it?

(7) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 5% simple interest?

(8) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $10132 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 8% simple interest.

(10) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 6% simple interest?