Simple Interest
Math MCQs

Question :    Thomas took a loan of $5600 at the rate of 8% simple interest per annum. If he paid an amount of $8288 to clear the loan, then find the time period of the loan.

Correct Answer  6

Solution & Explanation

Solution

Given,

Principal (P) = $5600

Rate of Simple Interest (R) = 8% per annum

Amount (A) = $8288

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 = $8288 – $5600 = $2688

Thus, Simple Interest = $2688

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 × 2688}/_{5600 × 8}

= ²⁶⁸⁸⁰⁰/₄₄₈₀₀

= 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) = $5600

Rate of Simple Interest (R) = 8% per annum

Simple Interest = $2688 (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 = 8% of Principal

= 8% of $5600

= ⁸/₁₀₀ × 5600

= ^{8 × 5600}/₁₀₀

= ⁴⁴⁸⁰⁰/₁₀₀ = 448

Thus, simple Interest for 1 year = $448

Now,

∵ If the simple Interest is $448, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₄₈ years

∴ If the simple Interest is $2688, then the time = ¹/₄₄₈ × 2688 years

= ^{1 × 2688}/₄₄₈ years

= ²⁶⁸⁸/₄₄₈ = 6 years

Thus, time (T) = 6 years Answer

Similar Questions

(1) Find the amount to be paid if Robert borrowed a sum of $5100 at 9% simple interest for 7 years.

(2) Calculate the amount due after 9 years if Joseph borrowed a sum of $5700 at a rate of 10% simple interest.

(3) How much loan did Patricia borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6180 to clear it?

(4) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 2% simple interest.

(5) Calculate the amount due after 10 years if Patricia borrowed a sum of $5150 at a rate of 7% simple interest.

(6) How much loan did Kevin borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8520 to clear it?

(7) If John paid $3456 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(8) What amount does David have to pay after 6 years if he takes a loan of $3400 at 4% simple interest?

(9) If Karen borrowed $3950 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(10) If Elizabeth borrowed $3450 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.