Simple Interest
Math MCQs

Question :    Linda took a loan of $4700 at the rate of 8% simple interest per annum. If he paid an amount of $7708 to clear the loan, then find the time period of the loan.

Correct Answer  8

Solution & Explanation

Solution

Given,

Principal (P) = $4700

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

Amount (A) = $7708

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 = $7708 – $4700 = $3008

Thus, Simple Interest = $3008

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 × 3008}/_{4700 × 8}

= ³⁰⁰⁸⁰⁰/₃₇₆₀₀

= 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) = $4700

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

Simple Interest = $3008 (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 $4700

= ⁸/₁₀₀ × 4700

= ^{8 × 4700}/₁₀₀

= ³⁷⁶⁰⁰/₁₀₀ = 376

Thus, simple Interest for 1 year = $376

Now,

∵ If the simple Interest is $376, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₇₆ years

∴ If the simple Interest is $3008, then the time = ¹/₃₇₆ × 3008 years

= ^{1 × 3008}/₃₇₆ years

= ³⁰⁰⁸/₃₇₆ = 8 years

Thus, time (T) = 8 years Answer

Similar Questions

(1) Calculate the amount due if Jessica borrowed a sum of $3750 at 9% simple interest for 4 years.

(2) Charles took a loan of $5800 at the rate of 7% simple interest per annum. If he paid an amount of $9454 to clear the loan, then find the time period of the loan.

(3) Find the amount to be paid if Thomas borrowed a sum of $5800 at 5% simple interest for 8 years.

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

(5) Nancy took a loan of $6300 at the rate of 9% simple interest per annum. If he paid an amount of $10836 to clear the loan, then find the time period of the loan.

(6) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $12060 to clear the loan, then find the time period of the loan.

(7) Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $8840 to clear the loan, then find the time period of the loan.

(8) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 9% simple interest.

(9) Calculate the amount due if Christopher borrowed a sum of $4000 at 2% simple interest for 4 years.

(10) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 4% simple interest for 7 years.