Simple Interest
Math MCQs

Question :    Susan took a loan of $5300 at the rate of 6% simple interest per annum. If he paid an amount of $8480 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $5300

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

Amount (A) = $8480

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 = $8480 – $5300 = $3180

Thus, Simple Interest = $3180

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 × 3180}/_{5300 × 6}

= ³¹⁸⁰⁰⁰/₃₁₈₀₀

= 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) = $5300

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

Simple Interest = $3180 (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 $5300

= ⁶/₁₀₀ × 5300

= ^{6 × 5300}/₁₀₀

= ³¹⁸⁰⁰/₁₀₀ = 318

Thus, simple Interest for 1 year = $318

Now,

∵ If the simple Interest is $318, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₁₈ years

∴ If the simple Interest is $3180, then the time = ¹/₃₁₈ × 3180 years

= ^{1 × 3180}/₃₁₈ years

= ³¹⁸⁰/₃₁₈ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) Calculate the amount due after 9 years if Barbara borrowed a sum of $5550 at a rate of 2% simple interest.

(2) Richard took a loan of $5200 at the rate of 6% simple interest per annum. If he paid an amount of $7072 to clear the loan, then find the time period of the loan.

(3) If Michelle paid $5544 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.

(4) Richard took a loan of $5200 at the rate of 8% simple interest per annum. If he paid an amount of $7696 to clear the loan, then find the time period of the loan.

(5) What amount does John have to pay after 6 years if he takes a loan of $3200 at 3% simple interest?

(6) Jessica took a loan of $5500 at the rate of 7% simple interest per annum. If he paid an amount of $8965 to clear the loan, then find the time period of the loan.

(7) Christopher took a loan of $6000 at the rate of 10% simple interest per annum. If he paid an amount of $12000 to clear the loan, then find the time period of the loan.

(8) How much loan did Elizabeth borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6812.5 to clear it?

(9) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 2% simple interest?

(10) Charles had to pay $4134 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.