Simple Interest
Math MCQs

Question :    Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $10595 to clear the loan, then find the time period of the loan.

Correct Answer  9

Solution & Explanation

Solution

Given,

Principal (P) = $6500

Rate of Simple Interest (R) = 7% per annum

Amount (A) = $10595

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 = $10595 – $6500 = $4095

Thus, Simple Interest = $4095

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 × 4095}/_{6500 × 7}

= ⁴⁰⁹⁵⁰⁰/₄₅₅₀₀

= 9 years (using formula)

Thus, Time (T) = 9 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) = 7% per annum

Simple Interest = $4095 (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 = 7% of Principal

= 7% of $6500

= ⁷/₁₀₀ × 6500

= ^{7 × 6500}/₁₀₀

= ⁴⁵⁵⁰⁰/₁₀₀ = 455

Thus, simple Interest for 1 year = $455

Now,

∵ If the simple Interest is $455, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₅₅ years

∴ If the simple Interest is $4095, then the time = ¹/₄₅₅ × 4095 years

= ^{1 × 4095}/₄₅₅ years

= ⁴⁰⁹⁵/₄₅₅ = 9 years

Thus, time (T) = 9 years Answer

Similar Questions

(1) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 3% simple interest?

(2) If Susan borrowed $3650 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(3) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 2% simple interest.

(4) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 2% simple interest.

(5) Barbara took a loan of $5100 at the rate of 10% simple interest per annum. If he paid an amount of $10200 to clear the loan, then find the time period of the loan.

(6) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $9240 to clear the loan, then find the time period of the loan.

(7) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 2% simple interest?

(8) If Steven paid $4968 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(9) Mary had to pay $3233 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(10) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 4% simple interest.