Simple Interest
Math MCQs

Question :    Patricia took a loan of $4300 at the rate of 8% simple interest per annum. If he paid an amount of $7052 to clear the loan, then find the time period of the loan.

Correct Answer  8

Solution & Explanation

Solution

Given,

Principal (P) = $4300

Rate of Simple Interest (R) = 8% per annum

Amount (A) = $7052

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 = $7052 – $4300 = $2752

Thus, Simple Interest = $2752

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 × 2752}/_{4300 × 8}

= ²⁷⁵²⁰⁰/₃₄₄₀₀

= 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) = $4300

Rate of Simple Interest (R) = 8% per annum

Simple Interest = $2752 (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 = 8% of Principal

= 8% of $4300

= ⁸/₁₀₀ × 4300

= ^{8 × 4300}/₁₀₀

= ³⁴⁴⁰⁰/₁₀₀ = 344

Thus, simple Interest for 1 year = $344

Now,

∵ If the simple Interest is $344, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₄₄ years

∴ If the simple Interest is $2752, then the time = ¹/₃₄₄ × 2752 years

= ^{1 × 2752}/₃₄₄ years

= ²⁷⁵²/₃₄₄ = 8 years

Thus, time (T) = 8 years Answer

Similar Questions

(1) Calculate the amount due if James borrowed a sum of $3000 at 8% simple interest for 4 years.

(2) Calculate the amount due if Richard borrowed a sum of $3600 at 5% simple interest for 4 years.

(3) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 6% simple interest.

(4) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 4% simple interest?

(5) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.

(6) Find the amount to be paid if John borrowed a sum of $5200 at 3% simple interest for 7 years.

(7) Calculate the amount due if Susan borrowed a sum of $3650 at 7% simple interest for 4 years.

(8) Calculate the amount due if Joseph borrowed a sum of $3700 at 10% simple interest for 3 years.

(9) Calculate the amount due if Joseph borrowed a sum of $3700 at 4% simple interest for 3 years.

(10) How much loan did Edward borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9500 to clear it?