Simple Interest
Math MCQs

Question :    Sarah took a loan of $5700 at the rate of 7% simple interest per annum. If he paid an amount of $8493 to clear the loan, then find the time period of the loan.

Correct Answer  7

Solution & Explanation

Solution

Given,

Principal (P) = $5700

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

Amount (A) = $8493

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 = $8493 – $5700 = $2793

Thus, Simple Interest = $2793

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 × 2793}/_{5700 × 7}

= ²⁷⁹³⁰⁰/₃₉₉₀₀

= 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) = $5700

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

Simple Interest = $2793 (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 $5700

= ⁷/₁₀₀ × 5700

= ^{7 × 5700}/₁₀₀

= ³⁹⁹⁰⁰/₁₀₀ = 399

Thus, simple Interest for 1 year = $399

Now,

∵ If the simple Interest is $399, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₉₉ years

∴ If the simple Interest is $2793, then the time = ¹/₃₉₉ × 2793 years

= ^{1 × 2793}/₃₉₉ years

= ²⁷⁹³/₃₉₉ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) Lisa took a loan of $6100 at the rate of 10% simple interest per annum. If he paid an amount of $10370 to clear the loan, then find the time period of the loan.

(2) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 6% simple interest?

(3) Calculate the amount due if Michael borrowed a sum of $3300 at 7% simple interest for 4 years.

(4) Calculate the amount due after 10 years if William borrowed a sum of $5500 at a rate of 6% simple interest.

(5) Calculate the amount due if Jennifer borrowed a sum of $3250 at 5% simple interest for 3 years.

(6) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 8% simple interest.

(7) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 6% simple interest.

(8) 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.

(9) Find the amount to be paid if Jessica borrowed a sum of $5750 at 3% simple interest for 8 years.

(10) Find the amount to be paid if Mary borrowed a sum of $5050 at 3% simple interest for 8 years.