Simple Interest
MCQs Math


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


Correct Answer  $9758

Solution And Explanation

Solution

Given,

Principal (P) = $5950

Rate of Simple Interest (SI) = 8%

Time (t) = 8 years

Thus, Amount (A) = ?

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

Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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 × 8% × 8

= $5950 ×8/100 × 8

= 5950 × 8 × 8/100

= 47600 × 8/100

= 380800/100

= $3808

Thus, Simple Interest = $3808

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 + $3808

= $9758

Thus, Amount to be paid = $9758 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) = 8%

And, Time (t) = 8 years

Thus, Amount (A)

= $5950 + ($5950 × 8% × 8)

= $5950 + ($5950 ×8/100 × 8)

= $5950 + (5950 × 8 × 8/100)

= $5950 + (47600 × 8/100)

= $5950 + (380800/100)

= $5950 + $3808 = $9758

Thus, Amount (A) to be paid = $9758 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 8%

This, means, $8 per $100 per year

∵ For $100, the simple interest for 1 year = $8

∴ For $1, the simple interest for 1 year = 8/100

∴ For $5950, the simple interest in 1 year

= 8/100 × 5950

= 8 × 5950/100

= 47600/100 = $476

Thus, simple interest for 1 year = $476

Therefore, simple interest for 8 years

= Simple interest for 1 year × 8

= $476 × 8 = $3808

Thus, Simple Interest (SI) = $3808

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5950 + $3808

= $9758

Thus, Amount to be paid = $9758 Answer


Similar Questions

(1) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 9% simple interest.

(2) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 5% simple interest?

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

(4) Margaret took a loan of $6700 at the rate of 10% simple interest per annum. If he paid an amount of $12730 to clear the loan, then find the time period of the loan.

(5) Donald had to pay $4905 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(6) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $10452 to clear the loan, then find the time period of the loan.

(7) William had to pay $3815 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(8) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 5% simple interest.

(9) What amount does David have to pay after 6 years if he takes a loan of $3400 at 3% simple interest?

(10) Donald took a loan of $7000 at the rate of 6% simple interest per annum. If he paid an amount of $9520 to clear the loan, then find the time period of the loan.


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