Simple Interest
Math MCQs

Question :    Linda took a loan of $4700 at the rate of 6% simple interest per annum. If he paid an amount of $6392 to clear the loan, then find the time period of the loan.

Correct Answer  6

Solution & Explanation

Solution

Given,

Principal (P) = $4700

Rate of Simple Interest (R) = 6% per annum

Amount (A) = $6392

Thus, time (T) = ?

Method (1) Using Formula

Calculation of Simple Interest, when Principal and Amount are given

Formual to Calculate Simple Interest when Principal and Amount are given

We know that, Amount (A) = Principal (P) + Simple Interest (SI)

⇒ Simple Interest (SI) = Amount – Principal

⇒ SI = $6392 – $4700 = $1692

Thus, Simple Interest = $1692

Calculation of the Time using forumula when Amount, Simple Interest and Principal are known

Formula to find the Time (T)

Time (T) = ^{100 × Simple Interest}/_{Principal × Rate of Interest}

⇒ T = ^{100 × SI}/_{P × R}

Thus, Time (T) = ^{100 × 1692}/_{4700 × 6}

= ¹⁶⁹²⁰⁰/₂₈₂₀₀

= 6 years (using formula)

Thus, Time (T) = 6 years (from time taken before calculation)Answer

Calculation of the Time using Unitary Method when Amount, Simple Interest and Principal are known

Here, we have

Principal (P) = $4700

Rate of Simple Interest (R) = 6% per annum

Simple Interest = $1692 (As calculated above by subtracting Principal from the Amount given)

We know that, interest is calculated on the basis of the Principal.

This means Simple Interest for 1 year = Rate of simple interest × Principal

Thus, Simple Interest for 1 year = 6% of Principal

= 6% of $4700

= ⁶/₁₀₀ × 4700

= ^{6 × 4700}/₁₀₀

= ²⁸²⁰⁰/₁₀₀ = 282

Thus, simple Interest for 1 year = $282

Now,

∵ If the simple Interest is $282, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₂₈₂ years

∴ If the simple Interest is $1692, then the time = ¹/₂₈₂ × 1692 years

= ^{1 × 1692}/₂₈₂ years

= ¹⁶⁹²/₂₈₂ = 6 years

Thus, time (T) = 6 years Answer

Similar Questions

(1) How much loan did Carol borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8107.5 to clear it?

(2) Calculate the amount due after 10 years if John borrowed a sum of $5200 at a rate of 4% simple interest.

(3) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 9% simple interest for 7 years.

(4) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 8% simple interest?

(5) What amount does John have to pay after 6 years if he takes a loan of $3200 at 7% simple interest?

(6) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $11868 to clear the loan, then find the time period of the loan.

(7) How much loan did Mary borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6312.5 to clear it?

(8) If Kenneth paid $5600 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(9) If Richard paid $3888 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(10) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 10% simple interest?