Simple Interest
Math MCQs

Question :    Find the amount to be paid if Michael borrowed a sum of $5300 at 6% simple interest for 7 years.

Correct Answer  $7526

Solution & Explanation

Solution

Given,

Principal (P) = $5300

Rate of Simple Interest (SI) = 6%

Time (t) = 7 years

Thus, Amount (A) = ?

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

Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $5300 × 6% × 7

= $5300 ×⁶/₁₀₀ × 7

= ^{5300 × 6 × 7}/₁₀₀

= ^{31800 × 7}/₁₀₀

= ²²²⁶⁰⁰/₁₀₀

= $2226

Thus, Simple Interest = $2226

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 = $5300 + $2226

= $7526

Thus, Amount to be paid = $7526 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 = $5300

Rate of Simple Interest (SI) or (R) = 6%

And, Time (t) = 7 years

Thus, Amount (A)

= $5300 + ($5300 × 6% × 7)

= $5300 + ($5300 ×⁶/₁₀₀ × 7)

= $5300 + (^{5300 × 6 × 7}/₁₀₀)

= $5300 + (^{31800 × 7}/₁₀₀)

= $5300 + (²²²⁶⁰⁰/₁₀₀)

= $5300 + $2226 = $7526

Thus, Amount (A) to be paid = $7526 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 6%

This, means, $6 per $100 per year

∵ For $100, the simple interest for 1 year = $6

∴ For $1, the simple interest for 1 year = ⁶/₁₀₀

∴ For $5300, the simple interest in 1 year

= ⁶/₁₀₀ × 5300

= ^{6 × 5300}/₁₀₀

= ³¹⁸⁰⁰/₁₀₀ = $318

Thus, simple interest for 1 year = $318

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $318 × 7 = $2226

Thus, Simple Interest (SI) = $2226

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5300 + $2226

= $7526

Thus, Amount to be paid = $7526 Answer

Similar Questions

(1) In how much time a principal of $3000 will amount to $3600 at a simple interest of 4% per annum?

(2) If Elizabeth paid $4140 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(3) What amount does Charles have to pay after 5 years if he takes a loan of $3900 at 10% simple interest?

(4) How much loan did Mary borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6060 to clear it?

(5) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 2% simple interest?

(6) Calculate the amount due after 10 years if Mary borrowed a sum of $5050 at a rate of 3% simple interest.

(7) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 5% simple interest?

(8) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $13200 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.

(10) Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $9774 to clear the loan, then find the time period of the loan.