Simple Interest
Math MCQs

Question :    Find the amount to be paid if Jennifer borrowed a sum of $5250 at 10% simple interest for 8 years.

Correct Answer  $9450

Solution & Explanation

Solution

Given,

Principal (P) = $5250

Rate of Simple Interest (SI) = 10%

Time (t) = 8 years

Thus, Amount (A) = ?

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

Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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 × 10% × 8

= $5250 ×¹⁰/₁₀₀ × 8

= ^{5250 × 10 × 8}/₁₀₀

= ^{52500 × 8}/₁₀₀

= ⁴²⁰⁰⁰⁰/₁₀₀

= $4200

Thus, Simple Interest = $4200

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 + $4200

= $9450

Thus, Amount to be paid = $9450 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) = 10%

And, Time (t) = 8 years

Thus, Amount (A)

= $5250 + ($5250 × 10% × 8)

= $5250 + ($5250 ×¹⁰/₁₀₀ × 8)

= $5250 + (^{5250 × 10 × 8}/₁₀₀)

= $5250 + (^{52500 × 8}/₁₀₀)

= $5250 + (⁴²⁰⁰⁰⁰/₁₀₀)

= $5250 + $4200 = $9450

Thus, Amount (A) to be paid = $9450 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 10%

This, means, $10 per $100 per year

∵ For $100, the simple interest for 1 year = $10

∴ For $1, the simple interest for 1 year = ¹⁰/₁₀₀

∴ For $5250, the simple interest in 1 year

= ¹⁰/₁₀₀ × 5250

= ^{10 × 5250}/₁₀₀

= ⁵²⁵⁰⁰/₁₀₀ = $525

Thus, simple interest for 1 year = $525

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $525 × 8 = $4200

Thus, Simple Interest (SI) = $4200

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5250 + $4200

= $9450

Thus, Amount to be paid = $9450 Answer

Similar Questions

(1) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 2% simple interest.

(2) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $13200 to clear the loan, then find the time period of the loan.

(3) Calculate the amount due if Karen borrowed a sum of $3950 at 7% simple interest for 4 years.

(4) If Emily paid $5700 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(5) Calculate the amount due if Charles borrowed a sum of $3900 at 10% simple interest for 3 years.

(6) If John borrowed $3200 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(7) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 3% simple interest.

(8) How much loan did Betty borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6875 to clear it?

(9) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 10% simple interest.

(10) In how much time a principal of $3050 will amount to $3416 at a simple interest of 3% per annum?