Simple Interest
Math MCQs

Question :  ( 1 of 10 )  Find the amount to be paid if David borrowed a sum of $5400 at 5% simple interest for 7 years.

Correct Answer  $7290

Solution & Explanation

Solution

Given,

Principal (P) = $5400

Rate of Simple Interest (SI) = 5%

Time (t) = 7 years

Thus, Amount (A) = ?

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

Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $5400 × 5% × 7

= $5400 ×⁵/₁₀₀ × 7

= ^{5400 × 5 × 7}/₁₀₀

= ^{27000 × 7}/₁₀₀

= ¹⁸⁹⁰⁰⁰/₁₀₀

= $1890

Thus, Simple Interest = $1890

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 = $5400 + $1890

= $7290

Thus, Amount to be paid = $7290 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 = $5400

Rate of Simple Interest (SI) or (R) = 5%

And, Time (t) = 7 years

Thus, Amount (A)

= $5400 + ($5400 × 5% × 7)

= $5400 + ($5400 ×⁵/₁₀₀ × 7)

= $5400 + (^{5400 × 5 × 7}/₁₀₀)

= $5400 + (^{27000 × 7}/₁₀₀)

= $5400 + (¹⁸⁹⁰⁰⁰/₁₀₀)

= $5400 + $1890 = $7290

Thus, Amount (A) to be paid = $7290 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 5%

This, means, $5 per $100 per year

∵ For $100, the simple interest for 1 year = $5

∴ For $1, the simple interest for 1 year = ⁵/₁₀₀

∴ For $5400, the simple interest in 1 year

= ⁵/₁₀₀ × 5400

= ^{5 × 5400}/₁₀₀

= ²⁷⁰⁰⁰/₁₀₀ = $270

Thus, simple interest for 1 year = $270

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $270 × 7 = $1890

Thus, Simple Interest (SI) = $1890

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5400 + $1890

= $7290

Thus, Amount to be paid = $7290 Answer

Similar Questions

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

(2) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 6% simple interest.

(3) Robert took a loan of $4200 at the rate of 9% simple interest per annum. If he paid an amount of $6468 to clear the loan, then find the time period of the loan.

(4) Kimberly had to pay $5208 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(5) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 8% simple interest?

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

(7) Calculate the amount due if Patricia borrowed a sum of $3150 at 6% simple interest for 3 years.

(8) Robert took a loan of $4200 at the rate of 9% simple interest per annum. If he paid an amount of $6846 to clear the loan, then find the time period of the loan.

(9) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $7020 to clear the loan, then find the time period of the loan.

(10) Charles took a loan of $5800 at the rate of 7% simple interest per annum. If he paid an amount of $9048 to clear the loan, then find the time period of the loan.