Simple Interest
Math MCQs

Question :    Mark had to pay $4664 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

Correct Answer  $4400

Solution & Explanation

Solution

Given,

Amount (A) = $4664

Rate of Simple Interest (R) = 2%

Time (T) = 3 years

Thus, Principal (P) = ?

Method (1) Using Formula

Calculation of the Principal using forumula when Amount, Time and Rate of Simple Interest are given

Formula to find the Principal (P)

Amount (A) = Principal (P) + Principal (P) × Rate (R) × Time (T)

⇒ Amount (A) = Principal (P) [1 + Rate (R) × Time (T)]

⇒ A = P (1 + RT)

Using the formula to find the Amount (A), the fourth can be calculated if any three of A, P, R, and T are given

In the given question, we need to find the Principal (P)

Therefore, by substituting, Amount, Rate, and Time, in the formula A = P (1 + RT) we get

$4664 = P (1 + 2% × 3)

⇒ $4664 = P (1 + ²/₁₀₀ × 3)

⇒ $4664 = P (1 + ^{2 × 3}/₁₀₀)

⇒ $4664 = P (1 + ⁶/₁₀₀)

⇒ $4664 = P (^{100 + 6}/₁₀₀)

⇒ $4664 = P × ¹⁰⁶/₁₀₀

⇒ P × ¹⁰⁶/₁₀₀ = $4664

⇒ P = ⁴⁶⁶⁴/_¹⁰⁶/100

⇒ P = 4664 × ¹⁰⁰/₁₀₆

⇒ P = ^{4664 × 100}/₁₀₆

⇒ P = ⁴⁶⁶⁴⁰⁰/₁₀₆

⇒ P = $4400

Thus, the sum borrowed (P) = $4400 Answer

Method (1) Using Unitary Method

Calculation of the Principal using unitary method when Amount, Time and Rate of Simple Interest are given

Calculation of the Simple Interest

Let, the principal = 100

Here, since rate of simple interest = 2% per annum

Thus, Interest = 2% of principal

⇒ Interest = 2% of 100 = 2

Thus, Simple Interest for 1 year = 2

Calculation of the Amount

Since, in the question, time = 3 years

So, we need to calculate the simple interest for the given time period, which is 3 years

Thus, Simple Interest for 3 years = 3 × Simple Interest for 1 year

= 3 × 2 = 6

Thus, simple interest for 3 years = 6

Thus, Amount (A) = Principal + Interest

⇒ Amount = 100 + 6 = 106

Calculation of the Principal

Now,

∵ If the Amount is 106, then the Principal = 100

∴ If the Amount is 1, then the Principal = ¹⁰⁰/₁₀₆

∴ If the Amount is 4664, then the Principal = ¹⁰⁰/₁₀₆ × 4664

= ^{100 × 4664}/₁₀₆

= ⁴⁶⁶⁴⁰⁰/₁₀₆

= 4400

Thus, Principal = $4400

Thus, the sum borrowed = $4400 Answer

Similar Questions

(1) Find the amount to be paid if Sarah borrowed a sum of $5850 at 6% simple interest for 8 years.

(2) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 3% simple interest.

(3) Lisa took a loan of $6100 at the rate of 6% simple interest per annum. If he paid an amount of $9760 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 6% simple interest.

(5) How much loan did Jacob borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8800 to clear it?

(6) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 2% simple interest.

(7) What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 4% simple interest?

(8) Calculate the amount due if Joseph borrowed a sum of $3700 at 4% simple interest for 3 years.

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

(10) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 10% simple interest.