Simple Interest
Math MCQs

Question :    Lisa took a loan of $6100 at the rate of 7% simple interest per annum. If he paid an amount of $9089 to clear the loan, then find the time period of the loan.

Correct Answer  7

Solution & Explanation

Solution

Given,

Principal (P) = $6100

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

Amount (A) = $9089

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 = $9089 – $6100 = $2989

Thus, Simple Interest = $2989

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 × 2989}/_{6100 × 7}

= ²⁹⁸⁹⁰⁰/₄₂₇₀₀

= 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) = $6100

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

Simple Interest = $2989 (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 $6100

= ⁷/₁₀₀ × 6100

= ^{7 × 6100}/₁₀₀

= ⁴²⁷⁰⁰/₁₀₀ = 427

Thus, simple Interest for 1 year = $427

Now,

∵ If the simple Interest is $427, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₂₇ years

∴ If the simple Interest is $2989, then the time = ¹/₄₂₇ × 2989 years

= ^{1 × 2989}/₄₂₇ years

= ²⁹⁸⁹/₄₂₇ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) Find the amount to be paid if Michael borrowed a sum of $5300 at 5% simple interest for 8 years.

(2) Find the amount to be paid if John borrowed a sum of $5200 at 4% simple interest for 8 years.

(3) Nancy took a loan of $6300 at the rate of 7% simple interest per annum. If he paid an amount of $10269 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 6% simple interest.

(5) If Charles paid $4680 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

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

(7) Calculate the amount due if Richard borrowed a sum of $3600 at 4% simple interest for 4 years.

(8) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 7% simple interest?

(9) Michael took a loan of $4600 at the rate of 10% simple interest per annum. If he paid an amount of $9200 to clear the loan, then find the time period of the loan.

(10) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 5% simple interest.