Simple Interest
Math MCQs

Question :    Find the amount to be paid if David borrowed a sum of $5400 at 5% simple interest for 8 years.

Correct Answer  $7560

Solution & Explanation

Solution

Given,

Principal (P) = $5400

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) = $5400 × 5% × 8

= $5400 ×⁵/₁₀₀ × 8

= ^{5400 × 5 × 8}/₁₀₀

= ^{27000 × 8}/₁₀₀

= ²¹⁶⁰⁰⁰/₁₀₀

= $2160

Thus, Simple Interest = $2160

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 + $2160

= $7560

Thus, Amount to be paid = $7560 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) = 5%

And, Time (t) = 8 years

Thus, Amount (A)

= $5400 + ($5400 × 5% × 8)

= $5400 + ($5400 ×⁵/₁₀₀ × 8)

= $5400 + (^{5400 × 5 × 8}/₁₀₀)

= $5400 + (^{27000 × 8}/₁₀₀)

= $5400 + (²¹⁶⁰⁰⁰/₁₀₀)

= $5400 + $2160 = $7560

Thus, Amount (A) to be paid = $7560 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 $5400, the simple interest in 1 year

= ⁵/₁₀₀ × 5400

= ^{5 × 5400}/₁₀₀

= ²⁷⁰⁰⁰/₁₀₀ = $270

Thus, simple interest for 1 year = $270

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $270 × 8 = $2160

Thus, Simple Interest (SI) = $2160

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5400 + $2160

= $7560

Thus, Amount to be paid = $7560 Answer

Similar Questions

(1) Find the amount to be paid if Susan borrowed a sum of $5650 at 2% simple interest for 8 years.

(2) Find the amount to be paid if Mary borrowed a sum of $5050 at 4% simple interest for 7 years.

(3) Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 7% simple interest.

(4) Richard took a loan of $5200 at the rate of 10% simple interest per annum. If he paid an amount of $10400 to clear the loan, then find the time period of the loan.

(5) Linda took a loan of $4700 at the rate of 9% simple interest per annum. If he paid an amount of $8084 to clear the loan, then find the time period of the loan.

(6) Find the amount to be paid if Richard borrowed a sum of $5600 at 3% simple interest for 7 years.

(7) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 4% simple interest.

(8) What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 6% simple interest?

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

(10) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 7% simple interest.