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) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 9% simple interest.

(2) If Emily paid $5320 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(3) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $7980 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 8% simple interest.

(5) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $6240 to clear the loan, then find the time period of the loan.

(6) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $8256 to clear the loan, then find the time period of the loan.

(7) If Charles paid $4680 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(8) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 6% simple interest?

(9) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 2% simple interest.

(10) Calculate the amount due after 10 years if Mary borrowed a sum of $5050 at a rate of 7% simple interest.