Simple Interest
Math MCQs

Question :    Find the amount to be paid if James borrowed a sum of $5000 at 9% simple interest for 7 years.

Correct Answer  $8150

Solution & Explanation

Solution

Given,

Principal (P) = $5000

Rate of Simple Interest (SI) = 9%

Time (t) = 7 years

Thus, Amount (A) = ?

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

Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $5000 × 9% × 7

= $5000 ×⁹/₁₀₀ × 7

= ^{5000 × 9 × 7}/₁₀₀

= ^{45000 × 7}/₁₀₀

= ³¹⁵⁰⁰⁰/₁₀₀

= $3150

Thus, Simple Interest = $3150

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 = $5000 + $3150

= $8150

Thus, Amount to be paid = $8150 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 = $5000

Rate of Simple Interest (SI) or (R) = 9%

And, Time (t) = 7 years

Thus, Amount (A)

= $5000 + ($5000 × 9% × 7)

= $5000 + ($5000 ×⁹/₁₀₀ × 7)

= $5000 + (^{5000 × 9 × 7}/₁₀₀)

= $5000 + (^{45000 × 7}/₁₀₀)

= $5000 + (³¹⁵⁰⁰⁰/₁₀₀)

= $5000 + $3150 = $8150

Thus, Amount (A) to be paid = $8150 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 9%

This, means, $9 per $100 per year

∵ For $100, the simple interest for 1 year = $9

∴ For $1, the simple interest for 1 year = ⁹/₁₀₀

∴ For $5000, the simple interest in 1 year

= ⁹/₁₀₀ × 5000

= ^{9 × 5000}/₁₀₀

= ⁴⁵⁰⁰⁰/₁₀₀ = $450

Thus, simple interest for 1 year = $450

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $450 × 7 = $3150

Thus, Simple Interest (SI) = $3150

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5000 + $3150

= $8150

Thus, Amount to be paid = $8150 Answer

Similar Questions

(1) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 9% simple interest.

(2) If Charles borrowed $3900 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(3) Charles took a loan of $5800 at the rate of 8% simple interest per annum. If he paid an amount of $9976 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 8% simple interest.

(5) Jennifer had to pay $3737.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

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

(7) Robert took a loan of $4200 at the rate of 7% simple interest per annum. If he paid an amount of $7140 to clear the loan, then find the time period of the loan.

(8) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 9% simple interest?

(9) If John paid $3456 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(10) Kimberly had to pay $5347.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.