Simple Interest
Math MCQs

Question :    Margaret took a loan of $6700 at the rate of 9% simple interest per annum. If he paid an amount of $10921 to clear the loan, then find the time period of the loan.

Correct Answer  7

Solution & Explanation

Solution

Given,

Principal (P) = $6700

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

Amount (A) = $10921

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 = $10921 – $6700 = $4221

Thus, Simple Interest = $4221

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 × 4221}/_{6700 × 9}

= ⁴²²¹⁰⁰/₆₀₃₀₀

= 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) = $6700

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

Simple Interest = $4221 (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 $6700

= ⁹/₁₀₀ × 6700

= ^{9 × 6700}/₁₀₀

= ⁶⁰³⁰⁰/₁₀₀ = 603

Thus, simple Interest for 1 year = $603

Now,

∵ If the simple Interest is $603, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₆₀₃ years

∴ If the simple Interest is $4221, then the time = ¹/₆₀₃ × 4221 years

= ^{1 × 4221}/₆₀₃ years

= ⁴²²¹/₆₀₃ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $11050 to clear the loan, then find the time period of the loan.

(2) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $7952 to clear the loan, then find the time period of the loan.

(3) In how much time a principal of $3200 will amount to $3392 at a simple interest of 2% per annum?

(4) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 4% simple interest for 7 years.

(5) What amount will be due after 2 years if James borrowed a sum of $3000 at a 8% simple interest?

(6) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 4% simple interest?

(7) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 7% simple interest?

(8) Elizabeth had to pay $3967.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(9) If Kenneth paid $5400 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(10) Linda had to pay $3852.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.