Simple Interest
Math MCQs

Question :    Mary took a loan of $4100 at the rate of 8% simple interest per annum. If he paid an amount of $6396 to clear the loan, then find the time period of the loan.

Correct Answer  7

Solution & Explanation

Solution

Given,

Principal (P) = $4100

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

Amount (A) = $6396

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 = $6396 – $4100 = $2296

Thus, Simple Interest = $2296

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 × 2296}/_{4100 × 8}

= ²²⁹⁶⁰⁰/₃₂₈₀₀

= 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) = $4100

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

Simple Interest = $2296 (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 $4100

= ⁸/₁₀₀ × 4100

= ^{8 × 4100}/₁₀₀

= ³²⁸⁰⁰/₁₀₀ = 328

Thus, simple Interest for 1 year = $328

Now,

∵ If the simple Interest is $328, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₂₈ years

∴ If the simple Interest is $2296, then the time = ¹/₃₂₈ × 2296 years

= ^{1 × 2296}/₃₂₈ years

= ²²⁹⁶/₃₂₈ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 9% simple interest.

(2) 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.

(3) Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 3% simple interest.

(4) Find the amount to be paid if Linda borrowed a sum of $5350 at 7% simple interest for 7 years.

(5) Find the amount to be paid if Jessica borrowed a sum of $5750 at 7% simple interest for 7 years.

(6) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 3% simple interest?

(7) What amount does William have to pay after 6 years if he takes a loan of $3500 at 9% simple interest?

(8) Calculate the amount due if Linda borrowed a sum of $3350 at 10% simple interest for 4 years.

(9) What amount does Charles have to pay after 5 years if he takes a loan of $3900 at 10% simple interest?

(10) Kimberly had to pay $5068.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.