Simple Interest
Math MCQs

Question :    Sandra took a loan of $6900 at the rate of 9% simple interest per annum. If he paid an amount of $11868 to clear the loan, then find the time period of the loan.

Correct Answer  8

Solution & Explanation

Solution

Given,

Principal (P) = $6900

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

Amount (A) = $11868

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 = $11868 – $6900 = $4968

Thus, Simple Interest = $4968

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 × 4968}/_{6900 × 9}

= ⁴⁹⁶⁸⁰⁰/₆₂₁₀₀

= 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) = $6900

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

Simple Interest = $4968 (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 $6900

= ⁹/₁₀₀ × 6900

= ^{9 × 6900}/₁₀₀

= ⁶²¹⁰⁰/₁₀₀ = 621

Thus, simple Interest for 1 year = $621

Now,

∵ If the simple Interest is $621, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₆₂₁ years

∴ If the simple Interest is $4968, then the time = ¹/₆₂₁ × 4968 years

= ^{1 × 4968}/₆₂₁ years

= ⁴⁹⁶⁸/₆₂₁ = 8 years

Thus, time (T) = 8 years Answer

Similar Questions

(1) Find the amount to be paid if Richard borrowed a sum of $5600 at 4% simple interest for 8 years.

(2) Matthew took a loan of $6400 at the rate of 10% simple interest per annum. If he paid an amount of $11520 to clear the loan, then find the time period of the loan.

(3) Matthew took a loan of $6400 at the rate of 8% simple interest per annum. If he paid an amount of $9472 to clear the loan, then find the time period of the loan.

(4) Find the amount to be paid if John borrowed a sum of $5200 at 2% simple interest for 8 years.

(5) Jessica took a loan of $5500 at the rate of 10% simple interest per annum. If he paid an amount of $9900 to clear the loan, then find the time period of the loan.

(6) Mary took a loan of $4100 at the rate of 10% simple interest per annum. If he paid an amount of $6560 to clear the loan, then find the time period of the loan.

(7) What amount does William have to pay after 5 years if he takes a loan of $3500 at 6% simple interest?

(8) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 5% simple interest.

(9) Betty had to pay $4760 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(10) How much loan did Sandra borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7740 to clear it?