Simple Interest
Math MCQs

Question :  ( 1 of 10 )  Find the amount to be paid if David borrowed a sum of $5400 at 3% simple interest for 8 years.

Correct Answer  $6696

Solution & Explanation

Solution

Given,

Principal (P) = $5400

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) = $5400 × 3% × 8

= $5400 ׳/₁₀₀ × 8

= ^{5400 × 3 × 8}/₁₀₀

= ^{16200 × 8}/₁₀₀

= ¹²⁹⁶⁰⁰/₁₀₀

= $1296

Thus, Simple Interest = $1296

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 = $5400 + $1296

= $6696

Thus, Amount to be paid = $6696 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 = $5400

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

And, Time (t) = 8 years

Thus, Amount (A)

= $5400 + ($5400 × 3% × 8)

= $5400 + ($5400 ׳/₁₀₀ × 8)

= $5400 + (^{5400 × 3 × 8}/₁₀₀)

= $5400 + (^{16200 × 8}/₁₀₀)

= $5400 + (¹²⁹⁶⁰⁰/₁₀₀)

= $5400 + $1296 = $6696

Thus, Amount (A) to be paid = $6696 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 $5400, the simple interest in 1 year

= ³/₁₀₀ × 5400

= ^{3 × 5400}/₁₀₀

= ¹⁶²⁰⁰/₁₀₀ = $162

Thus, simple interest for 1 year = $162

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $162 × 8 = $1296

Thus, Simple Interest (SI) = $1296

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5400 + $1296

= $6696

Thus, Amount to be paid = $6696 Answer

Similar Questions

(1) Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $8802 to clear the loan, then find the time period of the loan.

(2) In how much time a principal of $3050 will amount to $3416 at a simple interest of 4% per annum?

(3) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 2% simple interest.

(4) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 5% simple interest.

(5) How much loan did Cynthia borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8745 to clear it?

(6) How much loan did Sarah borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7020 to clear it?

(7) Find the amount to be paid if Joseph borrowed a sum of $5700 at 4% simple interest for 8 years.

(8) Calculate the amount due if James borrowed a sum of $3000 at 6% simple interest for 4 years.

(9) Calculate the amount due if Patricia borrowed a sum of $3150 at 7% simple interest for 4 years.

(10) What amount does Jessica have to pay after 5 years if he takes a loan of $3750 at 3% simple interest?