Simple Interest
Math MCQs

Question :    Sarah took a loan of $5700 at the rate of 8% simple interest per annum. If he paid an amount of $9348 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) = 8% per annum

Amount (A) = $9348

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 = $9348 – $5700 = $3648

Thus, Simple Interest = $3648

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 × 3648}/_{5700 × 8}

= ³⁶⁴⁸⁰⁰/₄₅₆₀₀

= 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) = 8% per annum

Simple Interest = $3648 (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 $5700

= ⁸/₁₀₀ × 5700

= ^{8 × 5700}/₁₀₀

= ⁴⁵⁶⁰⁰/₁₀₀ = 456

Thus, simple Interest for 1 year = $456

Now,

∵ If the simple Interest is $456, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₅₆ years

∴ If the simple Interest is $3648, then the time = ¹/₄₅₆ × 3648 years

= ^{1 × 3648}/₄₅₆ years

= ³⁶⁴⁸/₄₅₆ = 8 years

Thus, time (T) = 8 years Answer

Similar Questions

(1) If Margaret paid $4698 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(2) In how much time a principal of $3000 will amount to $3270 at a simple interest of 3% per annum?

(3) What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 6% simple interest?

(4) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 6% simple interest for 7 years.

(5) Calculate the amount due if Patricia borrowed a sum of $3150 at 9% simple interest for 4 years.

(6) How much loan did Joseph borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7125 to clear it?

(7) Patricia took a loan of $4300 at the rate of 7% simple interest per annum. If he paid an amount of $6407 to clear the loan, then find the time period of the loan.

(8) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7980 to clear it?

(9) Find the amount to be paid if Linda borrowed a sum of $5350 at 2% simple interest for 7 years.

(10) Steven had to pay $4876 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.