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) How much loan did Deborah borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8195 to clear it?

(2) How much loan did Mary borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $5807.5 to clear it?

(3) If Mary paid $3660 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(4) How much loan did Christopher borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6900 to clear it?

(5) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 2% simple interest.

(6) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $9916 to clear the loan, then find the time period of the loan.

(7) If John paid $3712 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(8) How much loan did Carol borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8812.5 to clear it?

(9) If Christopher borrowed $4000 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(10) Calculate the amount due if John borrowed a sum of $3200 at 8% simple interest for 4 years.