Simple Interest
Math MCQs

Question :    Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 2% simple interest.

Correct Answer  $6720

Solution & Explanation

Solution

Given,

Principal (P) = $5600

Rate of Simple Interest (SI) = 2%

Time (t) = 10 years

Thus, Amount (A) = ?

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

Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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) = $5600 × 2% × 10

= $5600 ײ/₁₀₀ × 10

= ^{5600 × 2 × 10}/₁₀₀

= ^{11200 × 10}/₁₀₀

= ¹¹²⁰⁰⁰/₁₀₀

= $1120

Thus, Simple Interest = $1120

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 = $5600 + $1120

= $6720

Thus, Amount to be paid = $6720 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 = $5600

Rate of Simple Interest (SI) or (R) = 2%

And, Time (t) = 10 years

Thus, Amount (A)

= $5600 + ($5600 × 2% × 10)

= $5600 + ($5600 ײ/₁₀₀ × 10)

= $5600 + (^{5600 × 2 × 10}/₁₀₀)

= $5600 + (^{11200 × 10}/₁₀₀)

= $5600 + (¹¹²⁰⁰⁰/₁₀₀)

= $5600 + $1120 = $6720

Thus, Amount (A) to be paid = $6720 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 2%

This, means, $2 per $100 per year

∵ For $100, the simple interest for 1 year = $2

∴ For $1, the simple interest for 1 year = ²/₁₀₀

∴ For $5600, the simple interest in 1 year

= ²/₁₀₀ × 5600

= ^{2 × 5600}/₁₀₀

= ¹¹²⁰⁰/₁₀₀ = $112

Thus, simple interest for 1 year = $112

Therefore, simple interest for 10 years

= Simple interest for 1 year × 10

= $112 × 10 = $1120

Thus, Simple Interest (SI) = $1120

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5600 + $1120

= $6720

Thus, Amount to be paid = $6720 Answer

Similar Questions

(1) Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $7810 to clear the loan, then find the time period of the loan.

(2) Anthony took a loan of $6600 at the rate of 8% simple interest per annum. If he paid an amount of $11352 to clear the loan, then find the time period of the loan.

(3) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $11560 to clear the loan, then find the time period of the loan.

(4) If Elizabeth borrowed $3450 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(5) Joseph took a loan of $5400 at the rate of 7% simple interest per annum. If he paid an amount of $7668 to clear the loan, then find the time period of the loan.

(6) Sarah had to pay $4312 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(7) If Linda paid $4020 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(8) Calculate the amount due after 10 years if James borrowed a sum of $5000 at a rate of 3% simple interest.

(9) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 10% simple interest.

(10) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 8% simple interest.