Simple Interest
Math MCQs

Question :    Find the amount to be paid if John borrowed a sum of $5200 at 3% simple interest for 8 years.

Correct Answer  $6448

Solution & Explanation

Solution

Given,

Principal (P) = $5200

Rate of Simple Interest (SI) = 3%

Time (t) = 8 years

Thus, Amount (A) = ?

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

Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $5200 × 3% × 8

= $5200 ׳/₁₀₀ × 8

= ^{5200 × 3 × 8}/₁₀₀

= ^{15600 × 8}/₁₀₀

= ¹²⁴⁸⁰⁰/₁₀₀

= $1248

Thus, Simple Interest = $1248

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 = $5200 + $1248

= $6448

Thus, Amount to be paid = $6448 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 = $5200

Rate of Simple Interest (SI) or (R) = 3%

And, Time (t) = 8 years

Thus, Amount (A)

= $5200 + ($5200 × 3% × 8)

= $5200 + ($5200 ׳/₁₀₀ × 8)

= $5200 + (^{5200 × 3 × 8}/₁₀₀)

= $5200 + (^{15600 × 8}/₁₀₀)

= $5200 + (¹²⁴⁸⁰⁰/₁₀₀)

= $5200 + $1248 = $6448

Thus, Amount (A) to be paid = $6448 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 3%

This, means, $3 per $100 per year

∵ For $100, the simple interest for 1 year = $3

∴ For $1, the simple interest for 1 year = ³/₁₀₀

∴ For $5200, the simple interest in 1 year

= ³/₁₀₀ × 5200

= ^{3 × 5200}/₁₀₀

= ¹⁵⁶⁰⁰/₁₀₀ = $156

Thus, simple interest for 1 year = $156

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $156 × 8 = $1248

Thus, Simple Interest (SI) = $1248

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5200 + $1248

= $6448

Thus, Amount to be paid = $6448 Answer

Similar Questions

(1) How much loan did Nancy borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7380 to clear it?

(2) Calculate the amount due if Barbara borrowed a sum of $3550 at 3% simple interest for 4 years.

(3) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $11400 to clear the loan, then find the time period of the loan.

(4) If John paid $3712 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(5) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 10% simple interest?

(6) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $10212 to clear the loan, then find the time period of the loan.

(7) Christopher took a loan of $6000 at the rate of 7% simple interest per annum. If he paid an amount of $9780 to clear the loan, then find the time period of the loan.

(8) If Kimberly paid $5022 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(9) Nancy took a loan of $6300 at the rate of 10% simple interest per annum. If he paid an amount of $10080 to clear the loan, then find the time period of the loan.

(10) Find the amount to be paid if Mary borrowed a sum of $5050 at 6% simple interest for 8 years.