Simple Interest
Math MCQs

Question :    Nancy took a loan of $6300 at the rate of 10% simple interest per annum. If he paid an amount of $10080 to clear the loan, then find the time period of the loan.

Correct Answer  6

Solution & Explanation

Solution

Given,

Principal (P) = $6300

Rate of Simple Interest (R) = 10% per annum

Amount (A) = $10080

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 = $10080 – $6300 = $3780

Thus, Simple Interest = $3780

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 × 3780}/_{6300 × 10}

= ³⁷⁸⁰⁰⁰/₆₃₀₀₀

= 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) = $6300

Rate of Simple Interest (R) = 10% per annum

Simple Interest = $3780 (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 = 10% of Principal

= 10% of $6300

= ¹⁰/₁₀₀ × 6300

= ^{10 × 6300}/₁₀₀

= ⁶³⁰⁰⁰/₁₀₀ = 630

Thus, simple Interest for 1 year = $630

Now,

∵ If the simple Interest is $630, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₆₃₀ years

∴ If the simple Interest is $3780, then the time = ¹/₆₃₀ × 3780 years

= ^{1 × 3780}/₆₃₀ years

= ³⁷⁸⁰/₆₃₀ = 6 years

Thus, time (T) = 6 years Answer

Similar Questions

(1) Jennifer took a loan of $4500 at the rate of 9% simple interest per annum. If he paid an amount of $8145 to clear the loan, then find the time period of the loan.

(2) Find the amount to be paid if Joseph borrowed a sum of $5700 at 2% simple interest for 8 years.

(3) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 6% simple interest for 7 years.

(4) If Joshua paid $5292 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(5) Calculate the amount due if Barbara borrowed a sum of $3550 at 8% simple interest for 4 years.

(6) David took a loan of $4800 at the rate of 7% simple interest per annum. If he paid an amount of $8160 to clear the loan, then find the time period of the loan.

(7) Richard had to pay $4032 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(8) How much loan did Stephanie borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9060 to clear it?

(9) If William borrowed $3500 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(10) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 2% simple interest.