Simple Interest
Math MCQs

Question :    Richard took a loan of $5200 at the rate of 10% simple interest per annum. If he paid an amount of $9360 to clear the loan, then find the time period of the loan.

Correct Answer  8

Solution & Explanation

Solution

Given,

Principal (P) = $5200

Rate of Simple Interest (R) = 10% per annum

Amount (A) = $9360

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 = $9360 – $5200 = $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}/_{5200 × 10}

= 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) = $5200

Rate of Simple Interest (R) = 10% 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 = 10% of Principal

= 10% of $5200

= ¹⁰/₁₀₀ × 5200

= ^{10 × 5200}/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) Calculate the amount due if Christopher borrowed a sum of $4000 at 8% simple interest for 4 years.

(2) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 4% simple interest for 4 years.

(3) Find the amount to be paid if Thomas borrowed a sum of $5800 at 10% simple interest for 8 years.

(4) How much loan did Michael borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6625 to clear it?

(5) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 7% simple interest?

(6) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 5% simple interest?

(7) If Susan paid $4088 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(8) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 10% simple interest for 8 years.

(9) Find the amount to be paid if Susan borrowed a sum of $5650 at 3% simple interest for 8 years.

(10) David took a loan of $4800 at the rate of 8% simple interest per annum. If he paid an amount of $7104 to clear the loan, then find the time period of the loan.