Simple Interest
Math MCQs

Question :    Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 4% simple interest.

Correct Answer  $7770

Solution & Explanation

Solution

Given,

Principal (P) = $5550

Rate of Simple Interest (SI) = 4%

Time (t) = 10 years

Thus, Amount (A) = ?

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

Thus, here 4% simple interest means, Rate of Simple Interest (SI) is 4% 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) = $5550 × 4% × 10

= $5550 ×⁴/₁₀₀ × 10

= ^{5550 × 4 × 10}/₁₀₀

= ^{22200 × 10}/₁₀₀

= ²²²⁰⁰⁰/₁₀₀

= $2220

Thus, Simple Interest = $2220

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 = $5550 + $2220

= $7770

Thus, Amount to be paid = $7770 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 = $5550

Rate of Simple Interest (SI) or (R) = 4%

And, Time (t) = 10 years

Thus, Amount (A)

= $5550 + ($5550 × 4% × 10)

= $5550 + ($5550 ×⁴/₁₀₀ × 10)

= $5550 + (^{5550 × 4 × 10}/₁₀₀)

= $5550 + (^{22200 × 10}/₁₀₀)

= $5550 + (²²²⁰⁰⁰/₁₀₀)

= $5550 + $2220 = $7770

Thus, Amount (A) to be paid = $7770 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 4%

This, means, $4 per $100 per year

∵ For $100, the simple interest for 1 year = $4

∴ For $1, the simple interest for 1 year = ⁴/₁₀₀

∴ For $5550, the simple interest in 1 year

= ⁴/₁₀₀ × 5550

= ^{4 × 5550}/₁₀₀

= ²²²⁰⁰/₁₀₀ = $222

Thus, simple interest for 1 year = $222

Therefore, simple interest for 10 years

= Simple interest for 1 year × 10

= $222 × 10 = $2220

Thus, Simple Interest (SI) = $2220

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5550 + $2220

= $7770

Thus, Amount to be paid = $7770 Answer

Similar Questions

(1) Jennifer had to pay $3542.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(2) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $8772 to clear the loan, then find the time period of the loan.

(3) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 4% simple interest?

(4) If Kenneth paid $5400 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(5) James had to pay $3270 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(6) What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 9% simple interest?

(7) What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 10% simple interest?

(8) If Linda borrowed $3350 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(9) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.

(10) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $10132 to clear the loan, then find the time period of the loan.