Simple Interest
Math MCQs

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

Correct Answer  $9000

Solution & Explanation

Solution

Given,

Principal (P) = $5000

Rate of Simple Interest (SI) = 8%

Time (t) = 10 years

Thus, Amount (A) = ?

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

Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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) = $5000 × 8% × 10

= $5000 ×⁸/₁₀₀ × 10

= ^{5000 × 8 × 10}/₁₀₀

= ^{40000 × 10}/₁₀₀

= ⁴⁰⁰⁰⁰⁰/₁₀₀

= $4000

Thus, Simple Interest = $4000

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 = $5000 + $4000

= $9000

Thus, Amount to be paid = $9000 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 = $5000

Rate of Simple Interest (SI) or (R) = 8%

And, Time (t) = 10 years

Thus, Amount (A)

= $5000 + ($5000 × 8% × 10)

= $5000 + ($5000 ×⁸/₁₀₀ × 10)

= $5000 + (^{5000 × 8 × 10}/₁₀₀)

= $5000 + (^{40000 × 10}/₁₀₀)

= $5000 + (⁴⁰⁰⁰⁰⁰/₁₀₀)

= $5000 + $4000 = $9000

Thus, Amount (A) to be paid = $9000 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 8%

This, means, $8 per $100 per year

∵ For $100, the simple interest for 1 year = $8

∴ For $1, the simple interest for 1 year = ⁸/₁₀₀

∴ For $5000, the simple interest in 1 year

= ⁸/₁₀₀ × 5000

= ^{8 × 5000}/₁₀₀

= ⁴⁰⁰⁰⁰/₁₀₀ = $400

Thus, simple interest for 1 year = $400

Therefore, simple interest for 10 years

= Simple interest for 1 year × 10

= $400 × 10 = $4000

Thus, Simple Interest (SI) = $4000

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5000 + $4000

= $9000

Thus, Amount to be paid = $9000 Answer

Similar Questions

(1) Calculate the amount due if Jessica borrowed a sum of $3750 at 6% simple interest for 4 years.

(2) Joseph took a loan of $5400 at the rate of 8% simple interest per annum. If he paid an amount of $7992 to clear the loan, then find the time period of the loan.

(3) Find the amount to be paid if Susan borrowed a sum of $5650 at 5% simple interest for 7 years.

(4) If Richard paid $4176 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(5) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 7% simple interest.

(6) Charles had to pay $4368 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(7) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 8% simple interest?

(8) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 9% simple interest?

(9) How much loan did Matthew borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7130 to clear it?

(10) Calculate the amount due if Joseph borrowed a sum of $3700 at 5% simple interest for 4 years.