Simple Interest
Math MCQs

Question :    Calculate the amount due after 10 years if William borrowed a sum of $5500 at a rate of 7% simple interest.

Correct Answer  $9350

Solution & Explanation

Solution

Given,

Principal (P) = $5500

Rate of Simple Interest (SI) = 7%

Time (t) = 10 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) = $5500 × 7% × 10

= $5500 ×⁷/₁₀₀ × 10

= ^{5500 × 7 × 10}/₁₀₀

= ^{38500 × 10}/₁₀₀

= ³⁸⁵⁰⁰⁰/₁₀₀

= $3850

Thus, Simple Interest = $3850

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 = $5500 + $3850

= $9350

Thus, Amount to be paid = $9350 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 = $5500

Rate of Simple Interest (SI) or (R) = 7%

And, Time (t) = 10 years

Thus, Amount (A)

= $5500 + ($5500 × 7% × 10)

= $5500 + ($5500 ×⁷/₁₀₀ × 10)

= $5500 + (^{5500 × 7 × 10}/₁₀₀)

= $5500 + (^{38500 × 10}/₁₀₀)

= $5500 + (³⁸⁵⁰⁰⁰/₁₀₀)

= $5500 + $3850 = $9350

Thus, Amount (A) to be paid = $9350 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 $5500, the simple interest in 1 year

= ⁷/₁₀₀ × 5500

= ^{7 × 5500}/₁₀₀

= ³⁸⁵⁰⁰/₁₀₀ = $385

Thus, simple interest for 1 year = $385

Therefore, simple interest for 10 years

= Simple interest for 1 year × 10

= $385 × 10 = $3850

Thus, Simple Interest (SI) = $3850

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5500 + $3850

= $9350

Thus, Amount to be paid = $9350 Answer

Similar Questions

(1) Calculate the amount due after 10 years if Mary borrowed a sum of $5050 at a rate of 3% simple interest.

(2) How much loan did Steven borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7920 to clear it?

(3) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 10% simple interest.

(4) What amount will be due after 2 years if Robert borrowed a sum of $3050 at a 7% simple interest?

(5) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 9% simple interest.

(6) If Nancy paid $4814 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(7) How much loan did Richard borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6440 to clear it?

(8) Patricia had to pay $3433.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(9) If Karen paid $4740 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(10) Calculate the amount due if Linda borrowed a sum of $3350 at 5% simple interest for 3 years.