Simple Interest
Math MCQs

Question :    David took a loan of $4800 at the rate of 6% simple interest per annum. If he paid an amount of $7680 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $4800

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

Amount (A) = $7680

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 = $7680 – $4800 = $2880

Thus, Simple Interest = $2880

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 × 2880}/_{4800 × 6}

= ²⁸⁸⁰⁰⁰/₂₈₈₀₀

= 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) = $4800

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

Simple Interest = $2880 (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 $4800

= ⁶/₁₀₀ × 4800

= ^{6 × 4800}/₁₀₀

= ²⁸⁸⁰⁰/₁₀₀ = 288

Thus, simple Interest for 1 year = $288

Now,

∵ If the simple Interest is $288, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₂₈₈ years

∴ If the simple Interest is $2880, then the time = ¹/₂₈₈ × 2880 years

= ^{1 × 2880}/₂₈₈ years

= ²⁸⁸⁰/₂₈₈ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) If Patricia paid $3528 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(2) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 8% simple interest.

(3) How much loan did Barbara borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6105 to clear it?

(4) Betty took a loan of $6500 at the rate of 9% simple interest per annum. If he paid an amount of $10010 to clear the loan, then find the time period of the loan.

(5) Calculate the amount due if Charles borrowed a sum of $3900 at 4% simple interest for 3 years.

(6) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 7% simple interest for 8 years.

(7) Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 3% simple interest.

(8) David took a loan of $4800 at the rate of 8% simple interest per annum. If he paid an amount of $8256 to clear the loan, then find the time period of the loan.

(9) Calculate the amount due if David borrowed a sum of $3400 at 9% simple interest for 4 years.

(10) Michelle had to pay $5692.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.