Simple Interest
Math MCQs

Question :    Find the amount to be paid if Barbara borrowed a sum of $5550 at 4% simple interest for 8 years.

Correct Answer  $7326

Solution & Explanation

Solution

Given,

Principal (P) = $5550

Rate of Simple Interest (SI) = 4%

Time (t) = 8 years

Thus, Amount (A) = ?

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

Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $5550 × 4% × 8

= $5550 ×⁴/₁₀₀ × 8

= ^{5550 × 4 × 8}/₁₀₀

= ^{22200 × 8}/₁₀₀

= ¹⁷⁷⁶⁰⁰/₁₀₀

= $1776

Thus, Simple Interest = $1776

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 = $5550 + $1776

= $7326

Thus, Amount to be paid = $7326 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 = $5550

Rate of Simple Interest (SI) or (R) = 4%

And, Time (t) = 8 years

Thus, Amount (A)

= $5550 + ($5550 × 4% × 8)

= $5550 + ($5550 ×⁴/₁₀₀ × 8)

= $5550 + (^{5550 × 4 × 8}/₁₀₀)

= $5550 + (^{22200 × 8}/₁₀₀)

= $5550 + (¹⁷⁷⁶⁰⁰/₁₀₀)

= $5550 + $1776 = $7326

Thus, Amount (A) to be paid = $7326 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 4%

This, means, $4 per $100 per year

∵ For $100, the simple interest for 1 year = $4

∴ For $1, the simple interest for 1 year = ⁴/₁₀₀

∴ For $5550, the simple interest in 1 year

= ⁴/₁₀₀ × 5550

= ^{4 × 5550}/₁₀₀

= ²²²⁰⁰/₁₀₀ = $222

Thus, simple interest for 1 year = $222

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $222 × 8 = $1776

Thus, Simple Interest (SI) = $1776

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5550 + $1776

= $7326

Thus, Amount to be paid = $7326 Answer

Similar Questions

(1) Joseph took a loan of $5400 at the rate of 10% simple interest per annum. If he paid an amount of $10260 to clear the loan, then find the time period of the loan.

(2) Find the amount to be paid if Barbara borrowed a sum of $5550 at 10% simple interest for 7 years.

(3) Calculate the amount due if Jennifer borrowed a sum of $3250 at 9% simple interest for 3 years.

(4) If Jessica borrowed $3750 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(5) Find the amount to be paid if Susan borrowed a sum of $5650 at 6% simple interest for 7 years.

(6) How much loan did Anthony borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6930 to clear it?

(7) Find the amount to be paid if David borrowed a sum of $5400 at 4% simple interest for 7 years.

(8) If Anthony paid $4644 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(9) What amount will be due after 2 years if Thomas borrowed a sum of $3400 at a 10% simple interest?

(10) Robert took a loan of $4200 at the rate of 8% simple interest per annum. If he paid an amount of $6216 to clear the loan, then find the time period of the loan.