Simple Interest
MCQs Math


Question:     What amount does David have to pay after 5 years if he takes a loan of $3400 at 9% simple interest?


Correct Answer  $4930

Solution And Explanation

Solution

Given,

Principal (P) = $3400

Rate of Simple Interest (SI) = 9%

Time (t) = 5 years

Thus, Amount (A) = ?

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

Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $3400 × 9% × 5

= $3400 ×9/100 × 5

= 3400 × 9 × 5/100

= 30600 × 5/100

= 153000/100

= $1530

Thus, Simple Interest = $1530

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 = $3400 + $1530

= $4930

Thus, Amount to be paid = $4930 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 = $3400

Rate of Simple Interest (SI) or (R) = 9%

And, Time (t) = 5 years

Thus, Amount (A)

= $3400 + ($3400 × 9% × 5)

= $3400 + ($3400 ×9/100 × 5)

= $3400 + (3400 × 9 × 5/100)

= $3400 + (30600 × 5/100)

= $3400 + (153000/100)

= $3400 + $1530 = $4930

Thus, Amount (A) to be paid = $4930 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 9%

This, means, $9 per $100 per year

∵ For $100, the simple interest for 1 year = $9

∴ For $1, the simple interest for 1 year = 9/100

∴ For $3400, the simple interest in 1 year

= 9/100 × 3400

= 9 × 3400/100

= 30600/100 = $306

Thus, simple interest for 1 year = $306

Therefore, simple interest for 5 years

= Simple interest for 1 year × 5

= $306 × 5 = $1530

Thus, Simple Interest (SI) = $1530

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3400 + $1530

= $4930

Thus, Amount to be paid = $4930 Answer


Similar Questions

(1) Mark took a loan of $6800 at the rate of 8% simple interest per annum. If he paid an amount of $11152 to clear the loan, then find the time period of the loan.

(2) What amount will be due after 2 years if David borrowed a sum of $3200 at a 6% simple interest?

(3) Find the amount to be paid if David borrowed a sum of $5400 at 8% simple interest for 8 years.

(4) Calculate the amount due if Patricia borrowed a sum of $3150 at 2% simple interest for 4 years.

(5) What amount does Joseph have to pay after 5 years if he takes a loan of $3700 at 6% simple interest?

(6) Linda had to pay $3852.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(7) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $10132 to clear the loan, then find the time period of the loan.

(8) Patricia took a loan of $4300 at the rate of 7% simple interest per annum. If he paid an amount of $7310 to clear the loan, then find the time period of the loan.

(9) What amount does William have to pay after 5 years if he takes a loan of $3500 at 4% simple interest?

(10) Jennifer took a loan of $4500 at the rate of 6% simple interest per annum. If he paid an amount of $6930 to clear the loan, then find the time period of the loan.


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