Simple Interest
Math MCQs

Question :    Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $11524 to clear the loan, then find the time period of the loan.

Correct Answer  9

Solution & Explanation

Solution

Given,

Principal (P) = $6700

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

Amount (A) = $11524

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 = $11524 – $6700 = $4824

Thus, Simple Interest = $4824

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 × 4824}/_{6700 × 8}

= ⁴⁸²⁴⁰⁰/₅₃₆₀₀

= 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) = $6700

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

Simple Interest = $4824 (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 $6700

= ⁸/₁₀₀ × 6700

= ^{8 × 6700}/₁₀₀

= ⁵³⁶⁰⁰/₁₀₀ = 536

Thus, simple Interest for 1 year = $536

Now,

∵ If the simple Interest is $536, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₅₃₆ years

∴ If the simple Interest is $4824, then the time = ¹/₅₃₆ × 4824 years

= ^{1 × 4824}/₅₃₆ years

= ⁴⁸²⁴/₅₃₆ = 9 years

Thus, time (T) = 9 years Answer

Similar Questions

(1) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 9% simple interest.

(2) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 8% simple interest.

(3) 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.

(4) Jennifer took a loan of $4500 at the rate of 9% simple interest per annum. If he paid an amount of $7740 to clear the loan, then find the time period of the loan.

(5) Find the amount to be paid if John borrowed a sum of $5200 at 2% simple interest for 7 years.

(6) Charles took a loan of $5800 at the rate of 9% simple interest per annum. If he paid an amount of $9454 to clear the loan, then find the time period of the loan.

(7) Sarah took a loan of $5700 at the rate of 6% simple interest per annum. If he paid an amount of $8778 to clear the loan, then find the time period of the loan.

(8) How much loan did Sharon borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9687.5 to clear it?

(9) Calculate the amount due if Mary borrowed a sum of $3050 at 6% simple interest for 4 years.

(10) If Sarah borrowed $3850 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.