Simple Interest
Math MCQs

Question :    John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $6248 to clear the loan, then find the time period of the loan.

Correct Answer  6

Solution & Explanation

Solution

Given,

Principal (P) = $4400

Rate of Simple Interest (R) = 7% per annum

Amount (A) = $6248

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 = $6248 – $4400 = $1848

Thus, Simple Interest = $1848

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 × 1848}/_{4400 × 7}

= ¹⁸⁴⁸⁰⁰/₃₀₈₀₀

= 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) = $4400

Rate of Simple Interest (R) = 7% per annum

Simple Interest = $1848 (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 = 7% of Principal

= 7% of $4400

= ⁷/₁₀₀ × 4400

= ^{7 × 4400}/₁₀₀

= ³⁰⁸⁰⁰/₁₀₀ = 308

Thus, simple Interest for 1 year = $308

Now,

∵ If the simple Interest is $308, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₀₈ years

∴ If the simple Interest is $1848, then the time = ¹/₃₀₈ × 1848 years

= ^{1 × 1848}/₃₀₈ years

= ¹⁸⁴⁸/₃₀₈ = 6 years

Thus, time (T) = 6 years Answer

Similar Questions

(1) What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 10% simple interest?

(2) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 3% simple interest.

(3) Calculate the amount due if James borrowed a sum of $3000 at 2% simple interest for 3 years.

(4) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 9% simple interest?

(5) If John borrowed $3200 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(6) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 3% simple interest.

(7) Matthew took a loan of $6400 at the rate of 6% simple interest per annum. If he paid an amount of $9472 to clear the loan, then find the time period of the loan.

(8) What amount will be due after 2 years if Steven borrowed a sum of $3800 at a 9% simple interest?

(9) Kimberly had to pay $4929 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(10) Nancy took a loan of $6300 at the rate of 7% simple interest per annum. If he paid an amount of $9828 to clear the loan, then find the time period of the loan.