Simple Interest
Math MCQs

Question :    Thomas took a loan of $5600 at the rate of 7% simple interest per annum. If he paid an amount of $9520 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $5600

Rate of Simple Interest (R) = 7% per annum

Amount (A) = $9520

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 = $9520 – $5600 = $3920

Thus, Simple Interest = $3920

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 × 3920}/_{5600 × 7}

= ³⁹²⁰⁰⁰/₃₉₂₀₀

= 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) = $5600

Rate of Simple Interest (R) = 7% per annum

Simple Interest = $3920 (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 = 7% of Principal

= 7% of $5600

= ⁷/₁₀₀ × 5600

= ^{7 × 5600}/₁₀₀

= ³⁹²⁰⁰/₁₀₀ = 392

Thus, simple Interest for 1 year = $392

Now,

∵ If the simple Interest is $392, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₉₂ years

∴ If the simple Interest is $3920, then the time = ¹/₃₉₂ × 3920 years

= ^{1 × 3920}/₃₉₂ years

= ³⁹²⁰/₃₉₂ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) Lisa took a loan of $6100 at the rate of 9% simple interest per annum. If he paid an amount of $11041 to clear the loan, then find the time period of the loan.

(2) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 10% simple interest?

(3) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 3% simple interest?

(4) Find the amount to be paid if Mary borrowed a sum of $5050 at 10% simple interest for 7 years.

(5) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 3% simple interest for 7 years.

(6) Find the amount to be paid if Linda borrowed a sum of $5350 at 6% simple interest for 8 years.

(7) James took a loan of $4000 at the rate of 7% simple interest per annum. If he paid an amount of $6240 to clear the loan, then find the time period of the loan.

(8) Find the amount to be paid if Charles borrowed a sum of $5900 at 4% simple interest for 8 years.

(9) Robert had to pay $3379 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.

(10) How much loan did Jennifer borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6300 to clear it?