Simple Interest
Math MCQs

Question :    Richard took a loan of $5200 at the rate of 7% simple interest per annum. If he paid an amount of $7384 to clear the loan, then find the time period of the loan.

Correct Answer  6

Solution & Explanation

Solution

Given,

Principal (P) = $5200

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

Amount (A) = $7384

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 = $7384 – $5200 = $2184

Thus, Simple Interest = $2184

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 × 2184}/_{5200 × 7}

= ²¹⁸⁴⁰⁰/₃₆₄₀₀

= 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) = $5200

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

Simple Interest = $2184 (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 $5200

= ⁷/₁₀₀ × 5200

= ^{7 × 5200}/₁₀₀

= ³⁶⁴⁰⁰/₁₀₀ = 364

Thus, simple Interest for 1 year = $364

Now,

∵ If the simple Interest is $364, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₆₄ years

∴ If the simple Interest is $2184, then the time = ¹/₃₆₄ × 2184 years

= ^{1 × 2184}/₃₆₄ years

= ²¹⁸⁴/₃₆₄ = 6 years

Thus, time (T) = 6 years Answer

Similar Questions

(1) Robert took a loan of $4200 at the rate of 7% simple interest per annum. If he paid an amount of $6258 to clear the loan, then find the time period of the loan.

(2) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 5% simple interest.

(3) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 9% simple interest.

(4) Find the amount to be paid if Robert borrowed a sum of $5100 at 2% simple interest for 8 years.

(5) Mark took a loan of $6800 at the rate of 6% simple interest per annum. If he paid an amount of $10064 to clear the loan, then find the time period of the loan.

(6) What amount will be due after 2 years if Joshua borrowed a sum of $3950 at a 9% simple interest?

(7) If Ashley paid $5096 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(8) Susan took a loan of $5300 at the rate of 8% simple interest per annum. If he paid an amount of $8692 to clear the loan, then find the time period of the loan.

(9) What amount does James have to pay after 5 years if he takes a loan of $3000 at 4% simple interest?

(10) Michelle had to pay $5395.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.