Simple Interest
Math MCQs

Question :    Find the amount to be paid if Jennifer borrowed a sum of $5250 at 5% simple interest for 8 years.

Correct Answer  $7350

Solution & Explanation

Solution

Given,

Principal (P) = $5250

Rate of Simple Interest (SI) = 5%

Time (t) = 8 years

Thus, Amount (A) = ?

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

Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $5250 × 5% × 8

= $5250 ×⁵/₁₀₀ × 8

= ^{5250 × 5 × 8}/₁₀₀

= ^{26250 × 8}/₁₀₀

= ²¹⁰⁰⁰⁰/₁₀₀

= $2100

Thus, Simple Interest = $2100

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 = $5250 + $2100

= $7350

Thus, Amount to be paid = $7350 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 = $5250

Rate of Simple Interest (SI) or (R) = 5%

And, Time (t) = 8 years

Thus, Amount (A)

= $5250 + ($5250 × 5% × 8)

= $5250 + ($5250 ×⁵/₁₀₀ × 8)

= $5250 + (^{5250 × 5 × 8}/₁₀₀)

= $5250 + (^{26250 × 8}/₁₀₀)

= $5250 + (²¹⁰⁰⁰⁰/₁₀₀)

= $5250 + $2100 = $7350

Thus, Amount (A) to be paid = $7350 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 5%

This, means, $5 per $100 per year

∵ For $100, the simple interest for 1 year = $5

∴ For $1, the simple interest for 1 year = ⁵/₁₀₀

∴ For $5250, the simple interest in 1 year

= ⁵/₁₀₀ × 5250

= ^{5 × 5250}/₁₀₀

= ²⁶²⁵⁰/₁₀₀ = $262.5

Thus, simple interest for 1 year = $262.5

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $262.5 × 8 = $2100

Thus, Simple Interest (SI) = $2100

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5250 + $2100

= $7350

Thus, Amount to be paid = $7350 Answer

Similar Questions

(1) How much loan did Karen borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7437.5 to clear it?

(2) Calculate the amount due if Robert borrowed a sum of $3100 at 7% simple interest for 4 years.

(3) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 9% simple interest?

(4) Find the amount to be paid if Patricia borrowed a sum of $5150 at 8% simple interest for 7 years.

(5) John had to pay $3488 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(6) Daniel took a loan of $6200 at the rate of 10% simple interest per annum. If he paid an amount of $12400 to clear the loan, then find the time period of the loan.

(7) If Patricia borrowed $3150 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(8) Matthew took a loan of $6400 at the rate of 8% simple interest per annum. If he paid an amount of $10496 to clear the loan, then find the time period of the loan.

(9) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 6% simple interest?

(10) Charles took a loan of $5800 at the rate of 10% simple interest per annum. If he paid an amount of $9280 to clear the loan, then find the time period of the loan.