Simple Interest
Math MCQs

Question :    Christopher took a loan of $6000 at the rate of 8% simple interest per annum. If he paid an amount of $9840 to clear the loan, then find the time period of the loan.

Correct Answer  8

Solution & Explanation

Solution

Given,

Principal (P) = $6000

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

Amount (A) = $9840

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 = $9840 – $6000 = $3840

Thus, Simple Interest = $3840

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 × 3840}/_{6000 × 8}

= ³⁸⁴⁰⁰⁰/₄₈₀₀₀

= 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) = $6000

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

Simple Interest = $3840 (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 $6000

= ⁸/₁₀₀ × 6000

= ^{8 × 6000}/₁₀₀

= ⁴⁸⁰⁰⁰/₁₀₀ = 480

Thus, simple Interest for 1 year = $480

Now,

∵ If the simple Interest is $480, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₈₀ years

∴ If the simple Interest is $3840, then the time = ¹/₄₈₀ × 3840 years

= ^{1 × 3840}/₄₈₀ years

= ³⁸⁴⁰/₄₈₀ = 8 years

Thus, time (T) = 8 years Answer

Similar Questions

(1) Find the amount to be paid if Charles borrowed a sum of $5900 at 4% simple interest for 8 years.

(2) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 3% simple interest?

(3) How much loan did Ronald borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8250 to clear it?

(4) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 7% simple interest.

(5) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 2% simple interest.

(6) Barbara took a loan of $5100 at the rate of 10% simple interest per annum. If he paid an amount of $8670 to clear the loan, then find the time period of the loan.

(7) How much loan did John borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5720 to clear it?

(8) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $7560 to clear the loan, then find the time period of the loan.

(9) Find the amount to be paid if Christopher borrowed a sum of $6000 at 4% simple interest for 8 years.

(10) If Steven paid $5152 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.