Simple Interest
Math MCQs

Question :    Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $10080 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $6300

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

Amount (A) = $10080

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 = $10080 – $6300 = $3780

Thus, Simple Interest = $3780

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 × 3780}/_{6300 × 6}

= ³⁷⁸⁰⁰⁰/₃₇₈₀₀

= 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) = $6300

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

Simple Interest = $3780 (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 $6300

= ⁶/₁₀₀ × 6300

= ^{6 × 6300}/₁₀₀

= ³⁷⁸⁰⁰/₁₀₀ = 378

Thus, simple Interest for 1 year = $378

Now,

∵ If the simple Interest is $378, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₇₈ years

∴ If the simple Interest is $3780, then the time = ¹/₃₇₈ × 3780 years

= ^{1 × 3780}/₃₇₈ years

= ³⁷⁸⁰/₃₇₈ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) If Christopher paid $4320 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.

(2) If Sarah borrowed $3850 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(3) Calculate the amount due if William borrowed a sum of $3500 at 2% simple interest for 4 years.

(4) How much loan did Ashley borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7205 to clear it?

(5) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 7% simple interest.

(6) Calculate the amount due after 10 years if Mary borrowed a sum of $5050 at a rate of 2% simple interest.

(7) Mark took a loan of $6800 at the rate of 6% simple interest per annum. If he paid an amount of $10472 to clear the loan, then find the time period of the loan.

(8) What amount does John have to pay after 5 years if he takes a loan of $3200 at 7% simple interest?

(9) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 5% simple interest?

(10) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 6% simple interest?