Simple Interest
MCQs Math


Question:     Find the amount to be paid if Karen borrowed a sum of $5950 at 7% simple interest for 8 years.


Correct Answer  $9282

Solution And Explanation

Solution

Given,

Principal (P) = $5950

Rate of Simple Interest (SI) = 7%

Time (t) = 8 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% × 8

= $5950 ×7/100 × 8

= 5950 × 7 × 8/100

= 41650 × 8/100

= 333200/100

= $3332

Thus, Simple Interest = $3332

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 + $3332

= $9282

Thus, Amount to be paid = $9282 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) = 8 years

Thus, Amount (A)

= $5950 + ($5950 × 7% × 8)

= $5950 + ($5950 ×7/100 × 8)

= $5950 + (5950 × 7 × 8/100)

= $5950 + (41650 × 8/100)

= $5950 + (333200/100)

= $5950 + $3332 = $9282

Thus, Amount (A) to be paid = $9282 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 8 years

= Simple interest for 1 year × 8

= $416.5 × 8 = $3332

Thus, Simple Interest (SI) = $3332

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5950 + $3332

= $9282

Thus, Amount to be paid = $9282 Answer


Similar Questions

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

(2) Calculate the amount due if Sarah borrowed a sum of $3850 at 9% simple interest for 3 years.

(3) In how much time a principal of $3150 will amount to $3339 at a simple interest of 2% per annum?

(4) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 9% simple interest?

(5) 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.

(6) In how much time a principal of $3100 will amount to $3472 at a simple interest of 4% per annum?

(7) In how much time a principal of $3050 will amount to $3233 at a simple interest of 3% per annum?

(8) If Karen paid $4740 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(9) If Michelle paid $5544 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(10) In how much time a principal of $3200 will amount to $3840 at a simple interest of 5% per annum?


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