Simple Interest
MCQs Math


Question:     What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 5% simple interest?


Correct Answer  $4290

Solution And Explanation

Solution

Given,

Principal (P) = $3300

Rate of Simple Interest (SI) = 5%

Time (t) = 6 years

Thus, Amount (A) = ?

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

Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $3300 × 5% × 6

= $3300 ×5/100 × 6

= 3300 × 5 × 6/100

= 16500 × 6/100

= 99000/100

= $990

Thus, Simple Interest = $990

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 = $3300 + $990

= $4290

Thus, Amount to be paid = $4290 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 = $3300

Rate of Simple Interest (SI) or (R) = 5%

And, Time (t) = 6 years

Thus, Amount (A)

= $3300 + ($3300 × 5% × 6)

= $3300 + ($3300 ×5/100 × 6)

= $3300 + (3300 × 5 × 6/100)

= $3300 + (16500 × 6/100)

= $3300 + (99000/100)

= $3300 + $990 = $4290

Thus, Amount (A) to be paid = $4290 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 5%

This, means, $5 per $100 per year

∵ For $100, the simple interest for 1 year = $5

∴ For $1, the simple interest for 1 year = 5/100

∴ For $3300, the simple interest in 1 year

= 5/100 × 3300

= 5 × 3300/100

= 16500/100 = $165

Thus, simple interest for 1 year = $165

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $165 × 6 = $990

Thus, Simple Interest (SI) = $990

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3300 + $990

= $4290

Thus, Amount to be paid = $4290 Answer


Similar Questions

(1) Calculate the amount due if David borrowed a sum of $3400 at 7% simple interest for 3 years.

(2) Calculate the amount due if Mary borrowed a sum of $3050 at 7% simple interest for 4 years.

(3) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $11084 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due if James borrowed a sum of $3000 at 2% simple interest for 3 years.

(5) Richard took a loan of $5200 at the rate of 8% simple interest per annum. If he paid an amount of $7696 to clear the loan, then find the time period of the loan.

(6) William took a loan of $5000 at the rate of 6% simple interest per annum. If he paid an amount of $7700 to clear the loan, then find the time period of the loan.

(7) What amount does John have to pay after 5 years if he takes a loan of $3200 at 9% simple interest?

(8) What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 6% simple interest?

(9) Matthew took a loan of $6400 at the rate of 10% simple interest per annum. If he paid an amount of $10240 to clear the loan, then find the time period of the loan.

(10) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 4% simple interest?


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