Simple Interest
Math MCQs

Question :    Find the amount to be paid if Linda borrowed a sum of $5350 at 6% simple interest for 8 years.

Correct Answer  $7918

Solution & Explanation

Solution

Given,

Principal (P) = $5350

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) = $5350 × 6% × 8

= $5350 ×⁶/₁₀₀ × 8

= ^{5350 × 6 × 8}/₁₀₀

= ^{32100 × 8}/₁₀₀

= ²⁵⁶⁸⁰⁰/₁₀₀

= $2568

Thus, Simple Interest = $2568

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 = $5350 + $2568

= $7918

Thus, Amount to be paid = $7918 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 = $5350

Rate of Simple Interest (SI) or (R) = 6%

And, Time (t) = 8 years

Thus, Amount (A)

= $5350 + ($5350 × 6% × 8)

= $5350 + ($5350 ×⁶/₁₀₀ × 8)

= $5350 + (^{5350 × 6 × 8}/₁₀₀)

= $5350 + (^{32100 × 8}/₁₀₀)

= $5350 + (²⁵⁶⁸⁰⁰/₁₀₀)

= $5350 + $2568 = $7918

Thus, Amount (A) to be paid = $7918 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 $5350, the simple interest in 1 year

= ⁶/₁₀₀ × 5350

= ^{6 × 5350}/₁₀₀

= ³²¹⁰⁰/₁₀₀ = $321

Thus, simple interest for 1 year = $321

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $321 × 8 = $2568

Thus, Simple Interest (SI) = $2568

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5350 + $2568

= $7918

Thus, Amount to be paid = $7918 Answer

Similar Questions

(1) What amount does David have to pay after 5 years if he takes a loan of $3400 at 3% simple interest?

(2) If Nancy paid $4482 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

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

(4) Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $9685 to clear the loan, then find the time period of the loan.

(5) Karen took a loan of $5900 at the rate of 8% simple interest per annum. If he paid an amount of $8732 to clear the loan, then find the time period of the loan.

(6) Anthony had to pay $4816 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(7) If Barbara borrowed $3550 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(8) Christopher had to pay $4240 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(9) Calculate the amount due if Joseph borrowed a sum of $3700 at 4% simple interest for 3 years.

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