Word Problems on Simple Interest

Word Problems on Simple Interest are solved here:

1. Robert deposits $ 3000 in State Bank of India for 3 year which earn him an interest of 8%.What is the amount he gets after 1 year, 2 years and 3 years?

Solution:

In every $ 100, Robert gets $ 8.

(Since rate is 8% → 8 for every 100)

Therefore, for $ 1 he gets = $ 8/100

And for $ 2000 he gets = 3000 x 8/100 

= $ 240

Simple Interest for 1 year = $ 240.

Simple Interest for 2 year = $ 240 x 2 

= $ 480

Simple Interest for 3 year = $ 240 x 3

= $ 720

Therefore, Amount after 1 year = Principal (P) + Simple Interest (SI)

= 3000 + 240

= $ 3240

Amount after 2 years = Principal (P) + Simple Interest (SI)

= 3000 + 480

= $ 3480

Amount after 3 years = Principal (P) + Simple Interest (SI)

= 3000 + 720 = $ 3720

We observe from the above example that, the Interest cannot be calculated without Principal, Rate and Time.

Therefore, we can conclude that Simple Interest (S.I.) depends upon:

(i) Principal (P)

(ii) Rate (R)

(iii) Time (T)

And therefore, the formula for calculating the simple interest is

Simple Interest (SI) = {Principal (P) × Rate (R) × Time (T)}/100

Amount (A) = Principal (P) + Interest (I)

Principal (P) = Amount (A) – Interest (I)

Interest (I) = Amount (A) – Principal (P)

2. Richard deposits $ 5400 and got back an amount of $ 6000 after a year. Find the simple interest he got.

Solution:

Principal (P) = $ 5400,

Amount (A) = $ 6000

Simple Interest (SI) = Amount (A) – Principal (P)

= 6000 - 5400

= 600

Therefore, Richard got an interest of $ 600.



3. Seth invested a certain amount of money and got back an amount of $ 8400. If the bank paid an interest of $ 700, find the amount Sam invested.

Solution:

Amount (A) = $ 8400,

Simple Interest (SI) = $ 700

Principal (P) = Amount (A) – Interest (I)

= 8400 - 700

= 7700

Therefore, Seth invested $ 7700.



4. Diego deposited $ 10000 for 4 year at a rate of 6% p.a. Find the interest and amount Diego got.

Solution:

Principal (P) = $ 10000,

Time (T) = 4 years,

Rate (R) = 6% p.a.

Simple Interest (SI) = {Principal (P) × Rate (R) × Time (T)}/100

= (10000 x 6 x 4)/100

= $ 2400

Amount (A) = Principal (P) + Interest (I)

= 10000 + 2400

= $ 12400

The interest Diego got = $ 2400.

Therefore, the amount Diego got $ 12400.

Worksheet on Word Problems on Simple Interest

1. Christopher borrowed $92000 from a bank for 5 years at the simple interest rate of 14% per annum. What amount will he return after 5 years?

2. Nairitee deposited $77000 in a bank for 3 years at the simple interest rate of 12.2% per annum. What amount will she get back?

3. Nitheeya borrowed a certain sum of money from Nairitee for ten years at the rate of 15% per annum. After ten years she returned the amount of $5000 to Nairitee. How much did she borrow from Nairitee?

4. Ronald received $7800 for his money deposited in a bank for four year. If the rate of simple interest was 8%, how much did he deposited in bank?

5. Margaret borrowed $3800 from Rebecca on the condition to pay the amount after 3 years at the simple interest rate of 10% per annum. How much will she pay to her after 3 years? Also calculate the interest paid on the principal money.

6. Richard borrowed $8000 from Michael for a fixed period at the simple interest rate of 12% per annum. He paid the amount of $10880. Find the time for which money was borrowed.

Answers:

1. $156,500

2. $1,05,182

3. $2000

4. $5,909.09

5. $4,940.00; $1,140.00

6. 3 years

● Simple Interest.

Word Problems on Simple Interest.

Factors Affecting Interest

In Simple Interest when the Time is given in Months and Days.

To find Principal when Time Interest and Rate are given.

To find Rate when Principal Interest and Time are given .

To find Time when Principal Interest and Rate are given.

Worksheet on Simple Interest.

Worksheet on Factors affecting Interest

5th Grade Numbers Page

5th Grade Math Problems

From Word Problems on Simple Interest to HOME PAGE