Simple Interest
MCQs Math


Question:     Calculate the amount due if Robert borrowed a sum of $3100 at 2% simple interest for 4 years.


Correct Answer  $3348

Solution And Explanation

Solution

Given,

Principal (P) = $3100

Rate of Simple Interest (SI) = 2%

Time (t) = 4 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) = $3100 × 2% × 4

= $3100 ×2/100 × 4

= 3100 × 2 × 4/100

= 6200 × 4/100

= 24800/100

= $248

Thus, Simple Interest = $248

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 = $3100 + $248

= $3348

Thus, Amount to be paid = $3348 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 = $3100

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

And, Time (t) = 4 years

Thus, Amount (A)

= $3100 + ($3100 × 2% × 4)

= $3100 + ($3100 ×2/100 × 4)

= $3100 + (3100 × 2 × 4/100)

= $3100 + (6200 × 4/100)

= $3100 + (24800/100)

= $3100 + $248 = $3348

Thus, Amount (A) to be paid = $3348 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 $3100, the simple interest in 1 year

= 2/100 × 3100

= 2 × 3100/100

= 6200/100 = $62

Thus, simple interest for 1 year = $62

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $62 × 4 = $248

Thus, Simple Interest (SI) = $248

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3100 + $248

= $3348

Thus, Amount to be paid = $3348 Answer


Similar Questions

(1) Find the amount to be paid if Susan borrowed a sum of $5650 at 7% simple interest for 8 years.

(2) How much loan did Kevin borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8875 to clear it?

(3) Betty took a loan of $6500 at the rate of 8% simple interest per annum. If he paid an amount of $10660 to clear the loan, then find the time period of the loan.

(4) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 4% simple interest?

(5) Find the amount to be paid if William borrowed a sum of $5500 at 2% simple interest for 7 years.

(6) Jennifer had to pay $3640 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(7) Find the amount to be paid if David borrowed a sum of $5400 at 7% simple interest for 7 years.

(8) If Thomas borrowed $3800 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 10 years if Christopher borrowed a sum of $6000 at a rate of 7% simple interest.

(10) Calculate the amount due if Barbara borrowed a sum of $3550 at 5% simple interest for 4 years.


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