Simple Interest
Math MCQs

Question :    Find the amount to be paid if Michael borrowed a sum of $5300 at 10% simple interest for 7 years.

Correct Answer  $9010

Solution & Explanation

Solution

Given,

Principal (P) = $5300

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) = $5300 × 10% × 7

= $5300 ×¹⁰/₁₀₀ × 7

= ^{5300 × 10 × 7}/₁₀₀

= ^{53000 × 7}/₁₀₀

= ³⁷¹⁰⁰⁰/₁₀₀

= $3710

Thus, Simple Interest = $3710

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 + $3710

= $9010

Thus, Amount to be paid = $9010 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) = 10%

And, Time (t) = 7 years

Thus, Amount (A)

= $5300 + ($5300 × 10% × 7)

= $5300 + ($5300 ×¹⁰/₁₀₀ × 7)

= $5300 + (^{5300 × 10 × 7}/₁₀₀)

= $5300 + (^{53000 × 7}/₁₀₀)

= $5300 + (³⁷¹⁰⁰⁰/₁₀₀)

= $5300 + $3710 = $9010

Thus, Amount (A) to be paid = $9010 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 $5300, the simple interest in 1 year

= ¹⁰/₁₀₀ × 5300

= ^{10 × 5300}/₁₀₀

= ⁵³⁰⁰⁰/₁₀₀ = $530

Thus, simple interest for 1 year = $530

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $530 × 7 = $3710

Thus, Simple Interest (SI) = $3710

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5300 + $3710

= $9010

Thus, Amount to be paid = $9010 Answer

Similar Questions

(1) Patricia took a loan of $4300 at the rate of 7% simple interest per annum. If he paid an amount of $6106 to clear the loan, then find the time period of the loan.

(2) In how much time a principal of $3100 will amount to $3720 at a simple interest of 5% per annum?

(3) What amount does John have to pay after 6 years if he takes a loan of $3200 at 9% simple interest?

(4) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 8% simple interest?

(5) What amount does Karen have to pay after 5 years if he takes a loan of $3950 at 5% simple interest?

(6) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 7% simple interest?

(7) Find the amount to be paid if Robert borrowed a sum of $5100 at 6% simple interest for 7 years.

(8) Find the amount to be paid if Patricia borrowed a sum of $5150 at 2% simple interest for 8 years.

(9) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $8688 to clear the loan, then find the time period of the loan.

(10) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 6% simple interest?