Simple Interest
Math MCQs

Question :    Sandra took a loan of $6900 at the rate of 6% simple interest per annum. If he paid an amount of $9798 to clear the loan, then find the time period of the loan.

Correct Answer  7

Solution & Explanation

Solution

Given,

Principal (P) = $6900

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

Amount (A) = $9798

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 = $9798 – $6900 = $2898

Thus, Simple Interest = $2898

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 × 2898}/_{6900 × 6}

= ²⁸⁹⁸⁰⁰/₄₁₄₀₀

= 7 years (using formula)

Thus, Time (T) = 7 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) = $6900

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

Simple Interest = $2898 (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 $6900

= ⁶/₁₀₀ × 6900

= ^{6 × 6900}/₁₀₀

= ⁴¹⁴⁰⁰/₁₀₀ = 414

Thus, simple Interest for 1 year = $414

Now,

∵ If the simple Interest is $414, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₁₄ years

∴ If the simple Interest is $2898, then the time = ¹/₄₁₄ × 2898 years

= ^{1 × 2898}/₄₁₄ years

= ²⁸⁹⁸/₄₁₄ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) How much loan did Jason borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8470 to clear it?

(2) Donna had to pay $5141 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(3) Steven had to pay $5290 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(4) Jennifer took a loan of $4500 at the rate of 9% simple interest per annum. If he paid an amount of $7740 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 2% simple interest.

(6) Michael took a loan of $4600 at the rate of 8% simple interest per annum. If he paid an amount of $7176 to clear the loan, then find the time period of the loan.

(7) Find the amount to be paid if Karen borrowed a sum of $5950 at 3% simple interest for 8 years.

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

(9) Christopher took a loan of $6000 at the rate of 7% simple interest per annum. If he paid an amount of $8940 to clear the loan, then find the time period of the loan.

(10) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $7920 to clear the loan, then find the time period of the loan.