Simple Interest
Math MCQs

Question :    Linda took a loan of $4700 at the rate of 8% simple interest per annum. If he paid an amount of $8084 to clear the loan, then find the time period of the loan.

Correct Answer  9

Solution & Explanation

Solution

Given,

Principal (P) = $4700

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

Amount (A) = $8084

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 = $8084 – $4700 = $3384

Thus, Simple Interest = $3384

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 × 3384}/_{4700 × 8}

= ³³⁸⁴⁰⁰/₃₇₆₀₀

= 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) = $4700

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

Simple Interest = $3384 (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 $4700

= ⁸/₁₀₀ × 4700

= ^{8 × 4700}/₁₀₀

= ³⁷⁶⁰⁰/₁₀₀ = 376

Thus, simple Interest for 1 year = $376

Now,

∵ If the simple Interest is $376, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₇₆ years

∴ If the simple Interest is $3384, then the time = ¹/₃₇₆ × 3384 years

= ^{1 × 3384}/₃₇₆ years

= ³³⁸⁴/₃₇₆ = 9 years

Thus, time (T) = 9 years Answer

Similar Questions

(1) If David borrowed $3400 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(2) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $7616 to clear the loan, then find the time period of the loan.

(3) Mary took a loan of $4100 at the rate of 6% simple interest per annum. If he paid an amount of $5822 to clear the loan, then find the time period of the loan.

(4) How much loan did Jason borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8470 to clear it?

(5) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 5% simple interest?

(6) If Michelle paid $5742 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(7) Susan took a loan of $5300 at the rate of 8% simple interest per annum. If he paid an amount of $9540 to clear the loan, then find the time period of the loan.

(8) What amount does Joseph have to pay after 5 years if he takes a loan of $3700 at 6% simple interest?

(9) Calculate the amount due after 9 years if Sarah borrowed a sum of $5850 at a rate of 8% simple interest.

(10) In how much time a principal of $3200 will amount to $3456 at a simple interest of 4% per annum?