Simple Interest
MCQs Math


Question:     Calculate the amount due if Barbara borrowed a sum of $3550 at 2% simple interest for 4 years.


Correct Answer  $3834

Solution And Explanation

Solution

Given,

Principal (P) = $3550

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) = $3550 × 2% × 4

= $3550 ×2/100 × 4

= 3550 × 2 × 4/100

= 7100 × 4/100

= 28400/100

= $284

Thus, Simple Interest = $284

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 = $3550 + $284

= $3834

Thus, Amount to be paid = $3834 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 = $3550

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

And, Time (t) = 4 years

Thus, Amount (A)

= $3550 + ($3550 × 2% × 4)

= $3550 + ($3550 ×2/100 × 4)

= $3550 + (3550 × 2 × 4/100)

= $3550 + (7100 × 4/100)

= $3550 + (28400/100)

= $3550 + $284 = $3834

Thus, Amount (A) to be paid = $3834 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 $3550, the simple interest in 1 year

= 2/100 × 3550

= 2 × 3550/100

= 7100/100 = $71

Thus, simple interest for 1 year = $71

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $71 × 4 = $284

Thus, Simple Interest (SI) = $284

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3550 + $284

= $3834

Thus, Amount to be paid = $3834 Answer


Similar Questions

(1) Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $8470 to clear the loan, then find the time period of the loan.

(2) Matthew took a loan of $6400 at the rate of 6% simple interest per annum. If he paid an amount of $8704 to clear the loan, then find the time period of the loan.

(3) Find the amount to be paid if William borrowed a sum of $5500 at 2% simple interest for 8 years.

(4) Michelle had to pay $5395.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(5) Calculate the amount due if James borrowed a sum of $3000 at 10% simple interest for 3 years.

(6) Calculate the amount due after 10 years if James borrowed a sum of $5000 at a rate of 7% simple interest.

(7) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 2% simple interest.

(8) Margaret took a loan of $6700 at the rate of 9% simple interest per annum. If he paid an amount of $10318 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due if Robert borrowed a sum of $3100 at 7% simple interest for 3 years.

(10) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 8% simple interest?


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