Simple Interest
Math MCQs

Question :    Find the amount to be paid if Thomas borrowed a sum of $5800 at 7% simple interest for 8 years.

Correct Answer  $9048

Solution & Explanation

Solution

Given,

Principal (P) = $5800

Rate of Simple Interest (SI) = 7%

Time (t) = 8 years

Thus, Amount (A) = ?

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

Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $5800 × 7% × 8

= $5800 ×⁷/₁₀₀ × 8

= ^{5800 × 7 × 8}/₁₀₀

= ^{40600 × 8}/₁₀₀

= ³²⁴⁸⁰⁰/₁₀₀

= $3248

Thus, Simple Interest = $3248

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 = $5800 + $3248

= $9048

Thus, Amount to be paid = $9048 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 = $5800

Rate of Simple Interest (SI) or (R) = 7%

And, Time (t) = 8 years

Thus, Amount (A)

= $5800 + ($5800 × 7% × 8)

= $5800 + ($5800 ×⁷/₁₀₀ × 8)

= $5800 + (^{5800 × 7 × 8}/₁₀₀)

= $5800 + (^{40600 × 8}/₁₀₀)

= $5800 + (³²⁴⁸⁰⁰/₁₀₀)

= $5800 + $3248 = $9048

Thus, Amount (A) to be paid = $9048 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 7%

This, means, $7 per $100 per year

∵ For $100, the simple interest for 1 year = $7

∴ For $1, the simple interest for 1 year = ⁷/₁₀₀

∴ For $5800, the simple interest in 1 year

= ⁷/₁₀₀ × 5800

= ^{7 × 5800}/₁₀₀

= ⁴⁰⁶⁰⁰/₁₀₀ = $406

Thus, simple interest for 1 year = $406

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $406 × 8 = $3248

Thus, Simple Interest (SI) = $3248

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5800 + $3248

= $9048

Thus, Amount to be paid = $9048 Answer

Similar Questions

(1) Calculate the amount due if John borrowed a sum of $3200 at 2% simple interest for 3 years.

(2) Find the amount to be paid if James borrowed a sum of $5000 at 5% simple interest for 8 years.

(3) Michael took a loan of $4600 at the rate of 9% simple interest per annum. If he paid an amount of $8326 to clear the loan, then find the time period of the loan.

(4) Elizabeth took a loan of $4900 at the rate of 7% simple interest per annum. If he paid an amount of $6958 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 6% simple interest.

(6) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $6864 to clear the loan, then find the time period of the loan.

(7) Michelle had to pay $5247 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(8) Calculate the amount due if Sarah borrowed a sum of $3850 at 6% simple interest for 4 years.

(9) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 9% simple interest.

(10) How much loan did Betty borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7187.5 to clear it?