Simple Interest
Math MCQs

Question :    Find the amount to be paid if Jennifer borrowed a sum of $5250 at 10% simple interest for 7 years.

Correct Answer  $8925

Solution & Explanation

Solution

Given,

Principal (P) = $5250

Rate of Simple Interest (SI) = 10%

Time (t) = 7 years

Thus, Amount (A) = ?

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

Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $5250 × 10% × 7

= $5250 ×¹⁰/₁₀₀ × 7

= ^{5250 × 10 × 7}/₁₀₀

= ^{52500 × 7}/₁₀₀

= ³⁶⁷⁵⁰⁰/₁₀₀

= $3675

Thus, Simple Interest = $3675

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 = $5250 + $3675

= $8925

Thus, Amount to be paid = $8925 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 = $5250

Rate of Simple Interest (SI) or (R) = 10%

And, Time (t) = 7 years

Thus, Amount (A)

= $5250 + ($5250 × 10% × 7)

= $5250 + ($5250 ×¹⁰/₁₀₀ × 7)

= $5250 + (^{5250 × 10 × 7}/₁₀₀)

= $5250 + (^{52500 × 7}/₁₀₀)

= $5250 + (³⁶⁷⁵⁰⁰/₁₀₀)

= $5250 + $3675 = $8925

Thus, Amount (A) to be paid = $8925 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 10%

This, means, $10 per $100 per year

∵ For $100, the simple interest for 1 year = $10

∴ For $1, the simple interest for 1 year = ¹⁰/₁₀₀

∴ For $5250, the simple interest in 1 year

= ¹⁰/₁₀₀ × 5250

= ^{10 × 5250}/₁₀₀

= ⁵²⁵⁰⁰/₁₀₀ = $525

Thus, simple interest for 1 year = $525

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $525 × 7 = $3675

Thus, Simple Interest (SI) = $3675

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5250 + $3675

= $8925

Thus, Amount to be paid = $8925 Answer

Similar Questions

(1) How much loan did Daniel borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6710 to clear it?

(2) Calculate the amount due if Joseph borrowed a sum of $3700 at 3% simple interest for 4 years.

(3) Find the amount to be paid if Sarah borrowed a sum of $5850 at 4% simple interest for 8 years.

(4) What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 6% simple interest?

(5) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 6% simple interest?

(6) Calculate the amount due if Sarah borrowed a sum of $3850 at 10% simple interest for 3 years.

(7) Find the amount to be paid if Robert borrowed a sum of $5100 at 3% simple interest for 7 years.

(8) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 8% simple interest.

(9) Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $10140 to clear the loan, then find the time period of the loan.

(10) 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.