Simple Interest
MCQs Math


Question:     What amount does Richard have to pay after 6 years if he takes a loan of $3600 at 10% simple interest?


Correct Answer  $5760

Solution And Explanation

Solution

Given,

Principal (P) = $3600

Rate of Simple Interest (SI) = 10%

Time (t) = 6 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) = $3600 × 10% × 6

= $3600 ×10/100 × 6

= 3600 × 10 × 6/100

= 36000 × 6/100

= 216000/100

= $2160

Thus, Simple Interest = $2160

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 = $3600 + $2160

= $5760

Thus, Amount to be paid = $5760 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 = $3600

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

And, Time (t) = 6 years

Thus, Amount (A)

= $3600 + ($3600 × 10% × 6)

= $3600 + ($3600 ×10/100 × 6)

= $3600 + (3600 × 10 × 6/100)

= $3600 + (36000 × 6/100)

= $3600 + (216000/100)

= $3600 + $2160 = $5760

Thus, Amount (A) to be paid = $5760 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 $3600, the simple interest in 1 year

= 10/100 × 3600

= 10 × 3600/100

= 36000/100 = $360

Thus, simple interest for 1 year = $360

Therefore, simple interest for 6 years

= Simple interest for 1 year × 6

= $360 × 6 = $2160

Thus, Simple Interest (SI) = $2160

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $3600 + $2160

= $5760

Thus, Amount to be paid = $5760 Answer


Similar Questions

(1) If Kenneth paid $5800 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(2) Calculate the amount due if Karen borrowed a sum of $3950 at 10% simple interest for 4 years.

(3) What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 4% simple interest?

(4) How much loan did John borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5720 to clear it?

(5) Emily had to pay $5177.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(6) If James borrowed $3000 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(7) In how much time a principal of $3200 will amount to $3520 at a simple interest of 2% per annum?

(8) Elizabeth took a loan of $4900 at the rate of 6% simple interest per annum. If he paid an amount of $6958 to clear the loan, then find the time period of the loan.

(9) How much loan did Margaret borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7302.5 to clear it?

(10) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $10921 to clear the loan, then find the time period of the loan.


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