Simple Interest
Math MCQs

Question :    Betty took a loan of $6500 at the rate of 8% simple interest per annum. If he paid an amount of $10660 to clear the loan, then find the time period of the loan.

Correct Answer  8

Solution & Explanation

Solution

Given,

Principal (P) = $6500

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

Amount (A) = $10660

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 = $10660 – $6500 = $4160

Thus, Simple Interest = $4160

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 × 4160}/_{6500 × 8}

= ⁴¹⁶⁰⁰⁰/₅₂₀₀₀

= 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) = $6500

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

Simple Interest = $4160 (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 $6500

= ⁸/₁₀₀ × 6500

= ^{8 × 6500}/₁₀₀

= ⁵²⁰⁰⁰/₁₀₀ = 520

Thus, simple Interest for 1 year = $520

Now,

∵ If the simple Interest is $520, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₅₂₀ years

∴ If the simple Interest is $4160, then the time = ¹/₅₂₀ × 4160 years

= ^{1 × 4160}/₅₂₀ years

= ⁴¹⁶⁰/₅₂₀ = 8 years

Thus, time (T) = 8 years Answer

Similar Questions

(1) Charles took a loan of $5800 at the rate of 6% simple interest per annum. If he paid an amount of $8236 to clear the loan, then find the time period of the loan.

(2) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 7% simple interest?

(3) Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $10132 to clear the loan, then find the time period of the loan.

(4) Michael had to pay $3597 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(5) In how much time a principal of $3050 will amount to $3233 at a simple interest of 2% per annum?

(6) What amount does James have to pay after 5 years if he takes a loan of $3000 at 2% simple interest?

(7) How much loan did Donna borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7535 to clear it?

(8) Barbara took a loan of $5100 at the rate of 6% simple interest per annum. If he paid an amount of $7242 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due if Michael borrowed a sum of $3300 at 9% simple interest for 3 years.

(10) Robert had to pay $3286 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.