Simple Interest
Math MCQs

Question :    Find the amount to be paid if David borrowed a sum of $5400 at 6% simple interest for 7 years.

Correct Answer  $7668

Solution & Explanation

Solution

Given,

Principal (P) = $5400

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) = $5400 × 6% × 7

= $5400 ×⁶/₁₀₀ × 7

= ^{5400 × 6 × 7}/₁₀₀

= ^{32400 × 7}/₁₀₀

= ²²⁶⁸⁰⁰/₁₀₀

= $2268

Thus, Simple Interest = $2268

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 + $2268

= $7668

Thus, Amount to be paid = $7668 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) = 6%

And, Time (t) = 7 years

Thus, Amount (A)

= $5400 + ($5400 × 6% × 7)

= $5400 + ($5400 ×⁶/₁₀₀ × 7)

= $5400 + (^{5400 × 6 × 7}/₁₀₀)

= $5400 + (^{32400 × 7}/₁₀₀)

= $5400 + (²²⁶⁸⁰⁰/₁₀₀)

= $5400 + $2268 = $7668

Thus, Amount (A) to be paid = $7668 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 $5400, the simple interest in 1 year

= ⁶/₁₀₀ × 5400

= ^{6 × 5400}/₁₀₀

= ³²⁴⁰⁰/₁₀₀ = $324

Thus, simple interest for 1 year = $324

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $324 × 7 = $2268

Thus, Simple Interest (SI) = $2268

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5400 + $2268

= $7668

Thus, Amount to be paid = $7668 Answer

Similar Questions

(1) In how much time a principal of $3050 will amount to $3324.5 at a simple interest of 3% per annum?

(2) Calculate the amount due if Mary borrowed a sum of $3050 at 2% simple interest for 3 years.

(3) How much loan did Kevin borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7810 to clear it?

(4) If Donna paid $5820 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(5) Matthew took a loan of $6400 at the rate of 9% simple interest per annum. If he paid an amount of $9856 to clear the loan, then find the time period of the loan.

(6) Calculate the amount due if Charles borrowed a sum of $3900 at 2% simple interest for 4 years.

(7) Jessica had to pay $4200 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(8) Patricia took a loan of $4300 at the rate of 9% simple interest per annum. If he paid an amount of $6622 to clear the loan, then find the time period of the loan.

(9) Jennifer took a loan of $4500 at the rate of 9% simple interest per annum. If he paid an amount of $8145 to clear the loan, then find the time period of the loan.

(10) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 9% simple interest for 7 years.