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 after 9 years if John borrowed a sum of $5200 at a rate of 3% simple interest.

(2) Calculate the amount due if Susan borrowed a sum of $3650 at 5% simple interest for 4 years.

(3) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $7956 to clear the loan, then find the time period of the loan.

(4) Christopher took a loan of $6000 at the rate of 6% simple interest per annum. If he paid an amount of $8880 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 8% simple interest.

(6) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 2% simple interest?

(7) Find the amount to be paid if David borrowed a sum of $5400 at 4% simple interest for 7 years.

(8) If William borrowed $3500 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(9) How much loan did Joshua borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8280 to clear it?

(10) Mary took a loan of $4100 at the rate of 6% simple interest per annum. If he paid an amount of $5822 to clear the loan, then find the time period of the loan.