Simple Interest
Math MCQs

Question :    Patricia took a loan of $4300 at the rate of 8% simple interest per annum. If he paid an amount of $6708 to clear the loan, then find the time period of the loan.

Correct Answer  7

Solution & Explanation

Solution

Given,

Principal (P) = $4300

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

Amount (A) = $6708

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 = $6708 – $4300 = $2408

Thus, Simple Interest = $2408

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 × 2408}/_{4300 × 8}

= ²⁴⁰⁸⁰⁰/₃₄₄₀₀

= 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) = $4300

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

Simple Interest = $2408 (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 $4300

= ⁸/₁₀₀ × 4300

= ^{8 × 4300}/₁₀₀

= ³⁴⁴⁰⁰/₁₀₀ = 344

Thus, simple Interest for 1 year = $344

Now,

∵ If the simple Interest is $344, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₄₄ years

∴ If the simple Interest is $2408, then the time = ¹/₃₄₄ × 2408 years

= ^{1 × 2408}/₃₄₄ years

= ²⁴⁰⁸/₃₄₄ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 7% simple interest.

(2) Jessica took a loan of $5500 at the rate of 7% simple interest per annum. If he paid an amount of $8195 to clear the loan, then find the time period of the loan.

(3) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 7% simple interest?

(4) What amount will be due after 2 years if Joshua borrowed a sum of $3950 at a 5% simple interest?

(5) Find the amount to be paid if Sarah borrowed a sum of $5850 at 4% simple interest for 8 years.

(6) If Joseph paid $3996 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(7) Find the amount to be paid if Mary borrowed a sum of $5050 at 2% simple interest for 7 years.

(8) How much loan did Deborah borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8940 to clear it?

(9) 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.

(10) Find the amount to be paid if Patricia borrowed a sum of $5150 at 6% simple interest for 7 years.