Simple Interest
Math MCQs

Question :    Find the amount to be paid if Thomas borrowed a sum of $5800 at 10% simple interest for 8 years.

Correct Answer  $10440

Solution & Explanation

Solution

Given,

Principal (P) = $5800

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) = $5800 × 10% × 8

= $5800 ×¹⁰/₁₀₀ × 8

= ^{5800 × 10 × 8}/₁₀₀

= ^{58000 × 8}/₁₀₀

= ⁴⁶⁴⁰⁰⁰/₁₀₀

= $4640

Thus, Simple Interest = $4640

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 + $4640

= $10440

Thus, Amount to be paid = $10440 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) = 10%

And, Time (t) = 8 years

Thus, Amount (A)

= $5800 + ($5800 × 10% × 8)

= $5800 + ($5800 ×¹⁰/₁₀₀ × 8)

= $5800 + (^{5800 × 10 × 8}/₁₀₀)

= $5800 + (^{58000 × 8}/₁₀₀)

= $5800 + (⁴⁶⁴⁰⁰⁰/₁₀₀)

= $5800 + $4640 = $10440

Thus, Amount (A) to be paid = $10440 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 $5800, the simple interest in 1 year

= ¹⁰/₁₀₀ × 5800

= ^{10 × 5800}/₁₀₀

= ⁵⁸⁰⁰⁰/₁₀₀ = $580

Thus, simple interest for 1 year = $580

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $580 × 8 = $4640

Thus, Simple Interest (SI) = $4640

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5800 + $4640

= $10440

Thus, Amount to be paid = $10440 Answer

Similar Questions

(1) How much loan did Anthony borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7560 to clear it?

(2) If Patricia borrowed $3150 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(3) If Charles paid $4368 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(4) Find the amount to be paid if Jessica borrowed a sum of $5750 at 3% simple interest for 7 years.

(5) Mark took a loan of $6800 at the rate of 8% simple interest per annum. If he paid an amount of $10608 to clear the loan, then find the time period of the loan.

(6) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $7526 to clear the loan, then find the time period of the loan.

(7) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 2% simple interest?

(8) What amount will be due after 2 years if Paul borrowed a sum of $3850 at a 4% simple interest?

(9) How much loan did Joseph borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6840 to clear it?

(10) What amount does William have to pay after 5 years if he takes a loan of $3500 at 3% simple interest?