Simple Interest
Math MCQs

Question :    Find the amount to be paid if Thomas borrowed a sum of $5800 at 3% simple interest for 8 years.

Correct Answer  $7192

Solution & Explanation

Solution

Given,

Principal (P) = $5800

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) = $5800 × 3% × 8

= $5800 ׳/₁₀₀ × 8

= ^{5800 × 3 × 8}/₁₀₀

= ^{17400 × 8}/₁₀₀

= ¹³⁹²⁰⁰/₁₀₀

= $1392

Thus, Simple Interest = $1392

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 = $5800 + $1392

= $7192

Thus, Amount to be paid = $7192 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 = $5800

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

And, Time (t) = 8 years

Thus, Amount (A)

= $5800 + ($5800 × 3% × 8)

= $5800 + ($5800 ׳/₁₀₀ × 8)

= $5800 + (^{5800 × 3 × 8}/₁₀₀)

= $5800 + (^{17400 × 8}/₁₀₀)

= $5800 + (¹³⁹²⁰⁰/₁₀₀)

= $5800 + $1392 = $7192

Thus, Amount (A) to be paid = $7192 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 $5800, the simple interest in 1 year

= ³/₁₀₀ × 5800

= ^{3 × 5800}/₁₀₀

= ¹⁷⁴⁰⁰/₁₀₀ = $174

Thus, simple interest for 1 year = $174

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $174 × 8 = $1392

Thus, Simple Interest (SI) = $1392

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5800 + $1392

= $7192

Thus, Amount to be paid = $7192 Answer

Similar Questions

(1) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 5% simple interest?

(2) Calculate the amount due if Mary borrowed a sum of $3050 at 9% simple interest for 4 years.

(3) Steven had to pay $5290 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(4) Find the amount to be paid if William borrowed a sum of $5500 at 10% simple interest for 7 years.

(5) How much loan did Timothy borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8880 to clear it?

(6) Calculate the amount due if John borrowed a sum of $3200 at 9% simple interest for 4 years.

(7) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $6248 to clear the loan, then find the time period of the loan.

(8) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 7% simple interest.

(9) How much loan did Sandra borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8062.5 to clear it?

(10) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 5% simple interest.