Simple Interest
Math MCQs

Question :    Jessica took a loan of $5500 at the rate of 10% simple interest per annum. If he paid an amount of $9350 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) = 10% per annum

Amount (A) = $9350

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 = $9350 – $5500 = $3850

Thus, Simple Interest = $3850

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 × 3850}/_{5500 × 10}

= ³⁸⁵⁰⁰⁰/₅₅₀₀₀

= 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) = 10% per annum

Simple Interest = $3850 (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 = 10% of Principal

= 10% of $5500

= ¹⁰/₁₀₀ × 5500

= ^{10 × 5500}/₁₀₀

= ⁵⁵⁰⁰⁰/₁₀₀ = 550

Thus, simple Interest for 1 year = $550

Now,

∵ If the simple Interest is $550, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₅₅₀ years

∴ If the simple Interest is $3850, then the time = ¹/₅₅₀ × 3850 years

= ^{1 × 3850}/₅₅₀ years

= ³⁸⁵⁰/₅₅₀ = 7 years

Thus, time (T) = 7 years Answer

Similar Questions

(1) William had to pay $4025 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(2) Sarah had to pay $4427.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.

(3) In how much time a principal of $3050 will amount to $3233 at a simple interest of 2% per annum?

(4) Find the amount to be paid if John borrowed a sum of $5200 at 9% simple interest for 8 years.

(5) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 10% simple interest.

(6) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $9983 to clear the loan, then find the time period of the loan.

(7) Donna had to pay $5286.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(8) What amount does Mary have to pay after 5 years if he takes a loan of $3050 at 4% simple interest?

(9) How much loan did Amanda borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8222.5 to clear it?

(10) Calculate the amount due if Thomas borrowed a sum of $3800 at 6% simple interest for 4 years.