Simple Interest
Math MCQs

Question :    Jessica took a loan of $5500 at the rate of 9% simple interest per annum. If he paid an amount of $8965 to clear the loan, then find the time period of the loan.

Correct Answer  7

Solution & Explanation

Solution

Given,

Principal (P) = $5500

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

Amount (A) = $8965

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 = $8965 – $5500 = $3465

Thus, Simple Interest = $3465

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 × 3465}/_{5500 × 9}

= ³⁴⁶⁵⁰⁰/₄₉₅₀₀

= 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) = $5500

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

Simple Interest = $3465 (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 $5500

= ⁹/₁₀₀ × 5500

= ^{9 × 5500}/₁₀₀

= ⁴⁹⁵⁰⁰/₁₀₀ = 495

Thus, simple Interest for 1 year = $495

Now,

∵ If the simple Interest is $495, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₉₅ years

∴ If the simple Interest is $3465, then the time = ¹/₄₉₅ × 3465 years

= ^{1 × 3465}/₄₉₅ years

= ³⁴⁶⁵/₄₉₅ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) What amount does Christopher have to pay after 6 years if he takes a loan of $4000 at 8% simple interest?

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

(3) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 5% simple interest?

(4) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 8% simple interest?

(5) Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 2% simple interest.

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

(7) If James paid $3240 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(8) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 9% simple interest.

(9) Emily had to pay $5320 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(10) If Susan paid $4380 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.