Simple Interest
Math MCQs

Question :    Find the amount to be paid if Richard borrowed a sum of $5600 at 10% simple interest for 7 years.

Correct Answer  $9520

Solution & Explanation

Solution

Given,

Principal (P) = $5600

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) = $5600 × 10% × 7

= $5600 ×¹⁰/₁₀₀ × 7

= ^{5600 × 10 × 7}/₁₀₀

= ^{56000 × 7}/₁₀₀

= ³⁹²⁰⁰⁰/₁₀₀

= $3920

Thus, Simple Interest = $3920

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 = $5600 + $3920

= $9520

Thus, Amount to be paid = $9520 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 = $5600

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

And, Time (t) = 7 years

Thus, Amount (A)

= $5600 + ($5600 × 10% × 7)

= $5600 + ($5600 ×¹⁰/₁₀₀ × 7)

= $5600 + (^{5600 × 10 × 7}/₁₀₀)

= $5600 + (^{56000 × 7}/₁₀₀)

= $5600 + (³⁹²⁰⁰⁰/₁₀₀)

= $5600 + $3920 = $9520

Thus, Amount (A) to be paid = $9520 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 $5600, the simple interest in 1 year

= ¹⁰/₁₀₀ × 5600

= ^{10 × 5600}/₁₀₀

= ⁵⁶⁰⁰⁰/₁₀₀ = $560

Thus, simple interest for 1 year = $560

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $560 × 7 = $3920

Thus, Simple Interest (SI) = $3920

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5600 + $3920

= $9520

Thus, Amount to be paid = $9520 Answer

Similar Questions

(1) James took a loan of $4000 at the rate of 9% simple interest per annum. If he paid an amount of $6160 to clear the loan, then find the time period of the loan.

(2) Matthew took a loan of $6400 at the rate of 7% simple interest per annum. If he paid an amount of $9536 to clear the loan, then find the time period of the loan.

(3) Sandra took a loan of $6900 at the rate of 6% simple interest per annum. If he paid an amount of $11040 to clear the loan, then find the time period of the loan.

(4) Karen took a loan of $5900 at the rate of 6% simple interest per annum. If he paid an amount of $9440 to clear the loan, then find the time period of the loan.

(5) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 9% simple interest?

(6) Calculate the amount due after 9 years if Barbara borrowed a sum of $5550 at a rate of 8% simple interest.

(7) Donna had to pay $5432 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(8) Calculate the amount due if William borrowed a sum of $3500 at 10% simple interest for 4 years.

(9) If David borrowed $3400 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

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