Simple Interest
MCQs Math


Question:     What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 5% simple interest?


Correct Answer  $4355

Solution And Explanation

Solution

Given,

Principal (P) = $3350

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) = $3350 × 5% × 6

= $3350 ×5/100 × 6

= 3350 × 5 × 6/100

= 16750 × 6/100

= 100500/100

= $1005

Thus, Simple Interest = $1005

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 = $3350 + $1005

= $4355

Thus, Amount to be paid = $4355 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 = $3350

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

And, Time (t) = 6 years

Thus, Amount (A)

= $3350 + ($3350 × 5% × 6)

= $3350 + ($3350 ×5/100 × 6)

= $3350 + (3350 × 5 × 6/100)

= $3350 + (16750 × 6/100)

= $3350 + (100500/100)

= $3350 + $1005 = $4355

Thus, Amount (A) to be paid = $4355 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 $3350, the simple interest in 1 year

= 5/100 × 3350

= 5 × 3350/100

= 16750/100 = $167.5

Thus, simple interest for 1 year = $167.5

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $167.5 × 6 = $1005

Thus, Simple Interest (SI) = $1005

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3350 + $1005

= $4355

Thus, Amount to be paid = $4355 Answer


Similar Questions

(1) What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 7% simple interest?

(2) Matthew took a loan of $6400 at the rate of 10% simple interest per annum. If he paid an amount of $12800 to clear the loan, then find the time period of the loan.

(3) Calculate the amount due if Michael borrowed a sum of $3300 at 5% simple interest for 4 years.

(4) Joseph took a loan of $5400 at the rate of 8% simple interest per annum. If he paid an amount of $7992 to clear the loan, then find the time period of the loan.

(5) If Ashley paid $4914 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(6) Calculate the amount due if Jessica borrowed a sum of $3750 at 4% simple interest for 4 years.

(7) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $8256 to clear the loan, then find the time period of the loan.

(8) Michael took a loan of $4600 at the rate of 6% simple interest per annum. If he paid an amount of $6808 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due after 10 years if William borrowed a sum of $5500 at a rate of 3% simple interest.

(10) Paul had to pay $4982 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.


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