Simple Interest
Math MCQs

Question :    Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $8802 to clear the loan, then find the time period of the loan.

Correct Answer  7

Solution & Explanation

Solution

Given,

Principal (P) = $5400

Rate of Simple Interest (R) = 9% per annum

Amount (A) = $8802

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 = $8802 – $5400 = $3402

Thus, Simple Interest = $3402

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 × 3402}/_{5400 × 9}

= ³⁴⁰²⁰⁰/₄₈₆₀₀

= 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) = $5400

Rate of Simple Interest (R) = 9% per annum

Simple Interest = $3402 (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 = 9% of Principal

= 9% of $5400

= ⁹/₁₀₀ × 5400

= ^{9 × 5400}/₁₀₀

= ⁴⁸⁶⁰⁰/₁₀₀ = 486

Thus, simple Interest for 1 year = $486

Now,

∵ If the simple Interest is $486, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₈₆ years

∴ If the simple Interest is $3402, then the time = ¹/₄₈₆ × 3402 years

= ^{1 × 3402}/₄₈₆ years

= ³⁴⁰²/₄₈₆ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) Sandra had to pay $5117.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(2) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 4% simple interest?

(3) Richard took a loan of $5200 at the rate of 8% simple interest per annum. If he paid an amount of $8112 to clear the loan, then find the time period of the loan.

(4) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $12540 to clear the loan, then find the time period of the loan.

(5) Linda took a loan of $4700 at the rate of 10% simple interest per annum. If he paid an amount of $8930 to clear the loan, then find the time period of the loan.

(6) Donald took a loan of $7000 at the rate of 6% simple interest per annum. If he paid an amount of $10360 to clear the loan, then find the time period of the loan.

(7) What amount does James have to pay after 6 years if he takes a loan of $3000 at 8% simple interest?

(8) Find the amount to be paid if Mary borrowed a sum of $5050 at 5% simple interest for 8 years.

(9) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 5% simple interest.

(10) Sandra had to pay $4850.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.