Simple Interest
Math MCQs

Question :    Sarah took a loan of $5700 at the rate of 7% simple interest per annum. If he paid an amount of $8892 to clear the loan, then find the time period of the loan.

Correct Answer  8

Solution & Explanation

Solution

Given,

Principal (P) = $5700

Rate of Simple Interest (R) = 7% per annum

Amount (A) = $8892

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 = $8892 – $5700 = $3192

Thus, Simple Interest = $3192

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 × 3192}/_{5700 × 7}

= ³¹⁹²⁰⁰/₃₉₉₀₀

= 8 years (using formula)

Thus, Time (T) = 8 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) = $5700

Rate of Simple Interest (R) = 7% per annum

Simple Interest = $3192 (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 = 7% of Principal

= 7% of $5700

= ⁷/₁₀₀ × 5700

= ^{7 × 5700}/₁₀₀

= ³⁹⁹⁰⁰/₁₀₀ = 399

Thus, simple Interest for 1 year = $399

Now,

∵ If the simple Interest is $399, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₉₉ years

∴ If the simple Interest is $3192, then the time = ¹/₃₉₉ × 3192 years

= ^{1 × 3192}/₃₉₉ years

= ³¹⁹²/₃₉₉ = 8 years

Thus, time (T) = 8 years Answer

Similar Questions

(1) Susan took a loan of $5300 at the rate of 9% simple interest per annum. If he paid an amount of $8162 to clear the loan, then find the time period of the loan.

(2) Calculate the amount due if Jennifer borrowed a sum of $3250 at 3% simple interest for 3 years.

(3) Find the amount to be paid if Karen borrowed a sum of $5950 at 5% simple interest for 7 years.

(4) Calculate the amount due if Jennifer borrowed a sum of $3250 at 4% simple interest for 4 years.

(5) What amount does John have to pay after 5 years if he takes a loan of $3200 at 2% simple interest?

(6) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 7% simple interest?

(7) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 7% simple interest.

(8) In how much time a principal of $3000 will amount to $3240 at a simple interest of 4% per annum?

(9) Andrew had to pay $5376 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(10) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 4% simple interest?