Simple Interest
Math MCQs

Question :    Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $9288 to clear the loan, then find the time period of the loan.

Correct Answer  8

Solution & Explanation

Solution

Given,

Principal (P) = $5400

Rate of Simple Interest (R) = 9% per annum

Amount (A) = $9288

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 = $9288 – $5400 = $3888

Thus, Simple Interest = $3888

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 × 3888}/_{5400 × 9}

= ³⁸⁸⁸⁰⁰/₄₈₆₀₀

= 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) = $5400

Rate of Simple Interest (R) = 9% per annum

Simple Interest = $3888 (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 = 9% of Principal

= 9% of $5400

= ⁹/₁₀₀ × 5400

= ^{9 × 5400}/₁₀₀

= ⁴⁸⁶⁰⁰/₁₀₀ = 486

Thus, simple Interest for 1 year = $486

Now,

∵ If the simple Interest is $486, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₈₆ years

∴ If the simple Interest is $3888, then the time = ¹/₄₈₆ × 3888 years

= ^{1 × 3888}/₄₈₆ years

= ³⁸⁸⁸/₄₈₆ = 8 years

Thus, time (T) = 8 years Answer

Similar Questions

(1) What amount will be due after 2 years if Mark borrowed a sum of $3700 at a 5% simple interest?

(2) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $7380 to clear the loan, then find the time period of the loan.

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

(4) Mark took a loan of $6800 at the rate of 9% simple interest per annum. If he paid an amount of $12308 to clear the loan, then find the time period of the loan.

(5) If Christopher paid $4800 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(6) If Michelle paid $5544 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(7) What amount does John have to pay after 6 years if he takes a loan of $3200 at 2% simple interest?

(8) Find the amount to be paid if Barbara borrowed a sum of $5550 at 5% simple interest for 7 years.

(9) Calculate the amount due if Robert borrowed a sum of $3100 at 7% simple interest for 3 years.

(10) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 7% simple interest.