Simple Interest
MCQs Math


Question:     Calculate the amount due if Charles borrowed a sum of $3900 at 10% simple interest for 4 years.


Correct Answer  $5460

Solution And Explanation

Solution

Given,

Principal (P) = $3900

Rate of Simple Interest (SI) = 10%

Time (t) = 4 years

Thus, Amount (A) = ?

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

Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $3900 × 10% × 4

= $3900 ×10/100 × 4

= 3900 × 10 × 4/100

= 39000 × 4/100

= 156000/100

= $1560

Thus, Simple Interest = $1560

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 = $3900 + $1560

= $5460

Thus, Amount to be paid = $5460 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 = $3900

Rate of Simple Interest (SI) or (R) = 10%

And, Time (t) = 4 years

Thus, Amount (A)

= $3900 + ($3900 × 10% × 4)

= $3900 + ($3900 ×10/100 × 4)

= $3900 + (3900 × 10 × 4/100)

= $3900 + (39000 × 4/100)

= $3900 + (156000/100)

= $3900 + $1560 = $5460

Thus, Amount (A) to be paid = $5460 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 10%

This, means, $10 per $100 per year

∵ For $100, the simple interest for 1 year = $10

∴ For $1, the simple interest for 1 year = 10/100

∴ For $3900, the simple interest in 1 year

= 10/100 × 3900

= 10 × 3900/100

= 39000/100 = $390

Thus, simple interest for 1 year = $390

Therefore, simple interest for 4 years

= Simple interest for 1 year × 4

= $390 × 4 = $1560

Thus, Simple Interest (SI) = $1560

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3900 + $1560

= $5460

Thus, Amount to be paid = $5460 Answer


Similar Questions

(1) Calculate the amount due if Linda borrowed a sum of $3350 at 2% simple interest for 4 years.

(2) How much loan did Laura borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $9027.5 to clear it?

(3) Sandra took a loan of $6900 at the rate of 10% simple interest per annum. If he paid an amount of $13110 to clear the loan, then find the time period of the loan.

(4) How much loan did Andrew borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7480 to clear it?

(5) Linda took a loan of $4700 at the rate of 9% simple interest per annum. If he paid an amount of $8507 to clear the loan, then find the time period of the loan.

(6) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 5% simple interest?

(7) In how much time a principal of $3100 will amount to $3286 at a simple interest of 2% per annum?

(8) 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.

(9) Find the amount to be paid if Susan borrowed a sum of $5650 at 10% simple interest for 8 years.

(10) James took a loan of $4000 at the rate of 10% simple interest per annum. If he paid an amount of $8000 to clear the loan, then find the time period of the loan.


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