Simple Interest
Math MCQs

Question :    Find the amount to be paid if Jennifer borrowed a sum of $5250 at 6% simple interest for 8 years.

Correct Answer  $7770

Solution & Explanation

Solution

Given,

Principal (P) = $5250

Rate of Simple Interest (SI) = 6%

Time (t) = 8 years

Thus, Amount (A) = ?

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

Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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 × 6% × 8

= $5250 ×⁶/₁₀₀ × 8

= ^{5250 × 6 × 8}/₁₀₀

= ^{31500 × 8}/₁₀₀

= ²⁵²⁰⁰⁰/₁₀₀

= $2520

Thus, Simple Interest = $2520

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 + $2520

= $7770

Thus, Amount to be paid = $7770 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) = 6%

And, Time (t) = 8 years

Thus, Amount (A)

= $5250 + ($5250 × 6% × 8)

= $5250 + ($5250 ×⁶/₁₀₀ × 8)

= $5250 + (^{5250 × 6 × 8}/₁₀₀)

= $5250 + (^{31500 × 8}/₁₀₀)

= $5250 + (²⁵²⁰⁰⁰/₁₀₀)

= $5250 + $2520 = $7770

Thus, Amount (A) to be paid = $7770 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 6%

This, means, $6 per $100 per year

∵ For $100, the simple interest for 1 year = $6

∴ For $1, the simple interest for 1 year = ⁶/₁₀₀

∴ For $5250, the simple interest in 1 year

= ⁶/₁₀₀ × 5250

= ^{6 × 5250}/₁₀₀

= ³¹⁵⁰⁰/₁₀₀ = $315

Thus, simple interest for 1 year = $315

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $315 × 8 = $2520

Thus, Simple Interest (SI) = $2520

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5250 + $2520

= $7770

Thus, Amount to be paid = $7770 Answer

Similar Questions

(1) Find the amount to be paid if Charles borrowed a sum of $5900 at 2% simple interest for 7 years.

(2) Michael took a loan of $4600 at the rate of 9% simple interest per annum. If he paid an amount of $7084 to clear the loan, then find the time period of the loan.

(3) What amount does James have to pay after 5 years if he takes a loan of $3000 at 7% simple interest?

(4) Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 2% simple interest.

(5) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 9% simple interest.

(6) Margaret had to pay $4611 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

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

(8) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 3% simple interest?

(9) How much loan did Ashley borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7860 to clear it?

(10) Linda took a loan of $4700 at the rate of 6% simple interest per annum. If he paid an amount of $7520 to clear the loan, then find the time period of the loan.