Simple Interest
Math MCQs

Question :    John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $7040 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $4400

Rate of Simple Interest (R) = 6% per annum

Amount (A) = $7040

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 = $7040 – $4400 = $2640

Thus, Simple Interest = $2640

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 × 2640}/_{4400 × 6}

= ²⁶⁴⁰⁰⁰/₂₆₄₀₀

= 10 years (using formula)

Thus, Time (T) = 10 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) = $4400

Rate of Simple Interest (R) = 6% per annum

Simple Interest = $2640 (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 = 6% of Principal

= 6% of $4400

= ⁶/₁₀₀ × 4400

= ^{6 × 4400}/₁₀₀

= ²⁶⁴⁰⁰/₁₀₀ = 264

Thus, simple Interest for 1 year = $264

Now,

∵ If the simple Interest is $264, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₂₆₄ years

∴ If the simple Interest is $2640, then the time = ¹/₂₆₄ × 2640 years

= ^{1 × 2640}/₂₆₄ years

= ²⁶⁴⁰/₂₆₄ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) Calculate the amount due if Linda borrowed a sum of $3350 at 5% simple interest for 3 years.

(2) John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $6776 to clear the loan, then find the time period of the loan.

(3) Calculate the amount due if Robert borrowed a sum of $3100 at 10% simple interest for 4 years.

(4) Patricia took a loan of $4300 at the rate of 6% simple interest per annum. If he paid an amount of $6106 to clear the loan, then find the time period of the loan.

(5) How much loan did William borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6325 to clear it?

(6) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 7% simple interest.

(7) Barbara took a loan of $5100 at the rate of 9% simple interest per annum. If he paid an amount of $7854 to clear the loan, then find the time period of the loan.

(8) Susan had to pay $4088 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(9) If Nancy paid $4814 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(10) David took a loan of $4800 at the rate of 10% simple interest per annum. If he paid an amount of $8160 to clear the loan, then find the time period of the loan.