Simple Interest
MCQs Math


Question:     Find the amount to be paid if Karen borrowed a sum of $5950 at 7% simple interest for 7 years.


Correct Answer  $8865.5

Solution And Explanation

Solution

Given,

Principal (P) = $5950

Rate of Simple Interest (SI) = 7%

Time (t) = 7 years

Thus, Amount (A) = ?

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

Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $5950 × 7% × 7

= $5950 ×7/100 × 7

= 5950 × 7 × 7/100

= 41650 × 7/100

= 291550/100

= $2915.5

Thus, Simple Interest = $2915.5

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 = $5950 + $2915.5

= $8865.5

Thus, Amount to be paid = $8865.5 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 = $5950

Rate of Simple Interest (SI) or (R) = 7%

And, Time (t) = 7 years

Thus, Amount (A)

= $5950 + ($5950 × 7% × 7)

= $5950 + ($5950 ×7/100 × 7)

= $5950 + (5950 × 7 × 7/100)

= $5950 + (41650 × 7/100)

= $5950 + (291550/100)

= $5950 + $2915.5 = $8865.5

Thus, Amount (A) to be paid = $8865.5 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 7%

This, means, $7 per $100 per year

∵ For $100, the simple interest for 1 year = $7

∴ For $1, the simple interest for 1 year = 7/100

∴ For $5950, the simple interest in 1 year

= 7/100 × 5950

= 7 × 5950/100

= 41650/100 = $416.5

Thus, simple interest for 1 year = $416.5

Therefore, simple interest for 7 years

= Simple interest for 1 year × 7

= $416.5 × 7 = $2915.5

Thus, Simple Interest (SI) = $2915.5

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5950 + $2915.5

= $8865.5

Thus, Amount to be paid = $8865.5 Answer


Similar Questions

(1) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 10% simple interest.

(2) Calculate the amount due if Karen borrowed a sum of $3950 at 3% simple interest for 3 years.

(3) Elizabeth took a loan of $4900 at the rate of 10% simple interest per annum. If he paid an amount of $8330 to clear the loan, then find the time period of the loan.

(4) In how much time a principal of $3050 will amount to $3507.5 at a simple interest of 3% per annum?

(5) Calculate the amount due if Patricia borrowed a sum of $3150 at 10% simple interest for 4 years.

(6) Calculate the amount due if Charles borrowed a sum of $3900 at 3% simple interest for 4 years.

(7) Find the amount to be paid if Susan borrowed a sum of $5650 at 2% simple interest for 8 years.

(8) How much loan did Mark borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7040 to clear it?

(9) Anthony took a loan of $6600 at the rate of 9% simple interest per annum. If he paid an amount of $10758 to clear the loan, then find the time period of the loan.

(10) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 3% simple interest.


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