Simple Interest
Math MCQs

Question :    Jennifer took a loan of $4500 at the rate of 10% simple interest per annum. If he paid an amount of $8550 to clear the loan, then find the time period of the loan.

Correct Answer  9

Solution & Explanation

Solution

Given,

Principal (P) = $4500

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

Amount (A) = $8550

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 = $8550 – $4500 = $4050

Thus, Simple Interest = $4050

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 × 4050}/_{4500 × 10}

= ⁴⁰⁵⁰⁰⁰/₄₅₀₀₀

= 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) = $4500

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

Simple Interest = $4050 (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 $4500

= ¹⁰/₁₀₀ × 4500

= ^{10 × 4500}/₁₀₀

= ⁴⁵⁰⁰⁰/₁₀₀ = 450

Thus, simple Interest for 1 year = $450

Now,

∵ If the simple Interest is $450, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₅₀ years

∴ If the simple Interest is $4050, then the time = ¹/₄₅₀ × 4050 years

= ^{1 × 4050}/₄₅₀ years

= ⁴⁰⁵⁰/₄₅₀ = 9 years

Thus, time (T) = 9 years Answer

Similar Questions

(1) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $8869 to clear the loan, then find the time period of the loan.

(2) If Michael borrowed $3300 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.

(3) What amount does James have to pay after 6 years if he takes a loan of $3000 at 7% simple interest?

(4) How much loan did Lisa borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6957.5 to clear it?

(5) How much loan did Sharon borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9300 to clear it?

(6) Calculate the amount due after 10 years if Susan borrowed a sum of $5650 at a rate of 10% simple interest.

(7) Calculate the amount due if Susan borrowed a sum of $3650 at 6% simple interest for 4 years.

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

(9) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 10% simple interest for 7 years.

(10) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 7% simple interest for 7 years.