Worksheet on Factors affecting Interest is here. In this article, you can come across problems related to Simple Interest. SI is received or paid over a particular period of time for the percentage fixed of the principal amount. Find all the terms and solved examples in Factors affecting Interest Worksheets with a detailed explanation. Refer to SI (Simple Interest) Formula and know about it in detail. Practice the Problems in Simple Interest Word Problems Worksheet and test your preparation levels.

When we borrow money from a person for a certain period of time, we have to return them with some extra amount known as interest.

Formula to Calculate Simple Interest = P * T * R / 100

where P is the Principal amount

T is Time Period

R is the Rate of Interest

To calculate the amount, we use the formula = Principal + Interest

Also, Refer:

## Simple Interest Questions and Answers

**Problem 1:**

A total of $20,000 is invested part of it at 6% and part of it at 6.5%. The total interest after one year is $1,260. How much was invested at each rate?

**Solution:**

Principal | Rate | Interest | |
---|---|---|---|

6% | X | .06 | |

5% | 20000 – X | 0.65 | |

Total | 20000 | – |

To find the amounts in the third column, we have to multiply the 1st column(Principal) and 2nd column(Rate)

Principal | Rate | Interest | |
---|---|---|---|

6% | X | .06 | .06X |

5% | 20000 – X | 0.65 | 0.65 (20000 – X) |

Total | 20000 | – | 1260 |

.06X +Â 0.65 (20000 – X) = 1260

1000 (.06X) + 1000(0.65)(20000 – X) = 1000(0.66)

60X + 65(2000 – X) = 1260000

60X + 1300000 – 65X = 1260000

-5X + 1300000 = 1260000

Subtract with 1300000 on both the sides

-5X + 1300000 = 1300000 = 1260000 – 1300000

-5X = 40000

X = -40000/5

X = 8,000 at 6%

20000 – X = 12,000 @ 6.5%

Therefore, the amount invested at 6% is 8,000

The amount invested at 6.5% is 12,000

**Problem 2:**

Find the interest that is generated from a $10,000 investment for 2 years at 6% simple interest?

**Solution:**

As given in the question,

Principal = 10,000

Rate = 6% = 0.06

Time = 2 years

To calculate the interest, we use the formula

Interest = Principal * Time * Rate / 100

Interest = 10,000 * 2 * 0.06 / 100

Interest = 1200

Therefore, the interest which is generated from $10,000 investment for 2 years at 6% simple interest is $1200

**Problem 3:**

John receives a large inheritance. He wants to invest part of it at 5% and $10,000 more than this amount at 11%. To earn $1200 per year in interest, how much will he need to invest at each rate?

**Solution:**

As given in the question,

Principal = $10,000

Rate = 5%

Interest per year = $1200

Let the amount which is invested at 5% = X

The amount invested at 11% = X + 10,000

To find the invest rate, we use the formula

Interest = Principal * Time * Rate / 100

1200 = 0.05X + 0.11(X + 10,000)

0.05X + 0.11X + 1100 = 1200

0.16X + 1100 = 1200

Subtract with 1100 on both sides

0.16X = 100

Divide by 0.16 on both sides

0.16X / 0.16 = 100 / 0.16

X = 625

Therefore, $625 will be invested at 5%

$10,625 will be invested at 11%

**Problem 4:**

John invests his savings in two ways: some go into a corporate bond paying 14% and $12,000 more than three times as much goes into a municipal bond fund paying 3%. If his total annual interest from the two investments is $11, 860. How much invested in each?

**Solution:**

Let the amount invested at 14% = X

Then, the amount invested at 3% = 3X + 12,000

0.14X + 0.3(3X + 12000) = 11,860

0.14X + 0.09X + 360 = 11,860

0.23X + 360 = 11,860

Subtract with 360 on both sides

0.23X + 360 – 360 = 11,860 – 360

0.23X = 11, 500

Divide by 0.23 on both sides

0.23X / 0.23 = 11,500 / 0.23

X = 50,000

Therefore, $50,000 is invested at 14%

$1,62,000 is invested at 3%

**Problem 5:**

Ramu deposits Rs. 5,000 in a bank which offers at 8% per annum. How much she will receive after 3 years?

**Solution:**

Rate is calculated per Rs. 100

For 1 year, on Rs. 100, SI = 8

For 1 year, on Rs. 1, SI = 8/100

For 1 year on Rs. 5000, SI = 5000 * 8/100

For 3 years on Rs. 5000, SI = 5000 * 8 * 3 / 100

= Rs. 1200

Therefore, Ramu will receive an interest of Rs. 1200 after 3 years

**Problem 6:**

Rahul borrowed Rs. 700 from a bank at 7% per year for 4 years. How much interest will he pay at the end of the fourth year?

**Solution:**

As given in the question,

Principal = Rs. 700

Rate = 7% per annum

Time = 4 years

Simple Interest = Principal * Rate * Time / 100

SI = 700 * 7 * 4 / 100

SI = Rs. 196

Therefore, Rahul paid an interest of Rs. 196 at the end of the fourth year.

**Problem 7:**

John invests Rs. 5000 in savings account at an annual rate of 8% for 5 years.

a) Find the amount of money he earned in the interest?

b) Find the savings accounts total value?

**Solution:**

As given in the question,

Principal = 5000

Rate = 8% = 0.08

Time = 5 years

We know that

Simple Interest = Principal * Time * Rate / 100

SI = 5000 * 5 * 0.08

SI = 400 * 5

SI = 2000

Therefore, the money he earned in interest = Rs. 2000

Total value in a savings account

F = I + P

F = 2000 + 5000

F = 7000

The total value of his savings account = 7000

Therefore,

The money he earned in interest = Rs. 2000

The total value of his savings account = 7000

**Problem 8:**

Noel invests Rs. 8000 into an account paying an annual interest rate of 8.7%. How many years will it take for him to earn Rs. 4872 in interest?

**Solution:**

As given in the question,

Principal = 8000, Rate = 8.7% = 0.087, I = 4872

We know the formula as,

Simple Interest S. I = P * T * R / 100

Substitute the values in the above equation,

4872 = 8000 * 0.087 * T / 100

4872 = 696 T

Divide by 696 on both sides

4872 / 696 = 696 T / 696

T = 7 years

**Problem 9:**

Marvel invest 3000 into a savings account. In 4 years she earns a total of Rs. 768 in interest. What is the annual interest rate offered by this account?

**Solution:**

As given in the question,

Principal = 3000, Interest = Rs. 768, Time = 4 years

We know the formula,

Simple Interest = P * T * R / 100

768 = 3000 * R * 4

768 = 12000 * R

Divide by 12000 on both sides

768 / 12000 = 12000 * R / 12000

R = 768 / 12000

R = 0.064

R = 6.4%

Therefore, the annual interest rate offered by this account = 6.4%

**Problem 10:**

Lucie invested Rs. 25000 into an account paying 8% annual interest. How many years will it take for his account to reach Rs. 43000?

**Solution:**

As given in the question,

Principal = Rs. 25000, F = 43000, Rate = 8% = 0.08

As we know that,

I = F – P

I = 43000 – 25000

I = 18000

We also know that

SI = P * R * T / 100

18000 = 25000 * 0.08 * T

Divide by 2000 on both sides

18000 / 2000 = 25000 * 0.08 * T /2000

T = 9 years

Therefore, it takes 9 years will it take for his account to reach Rs. 43000.