Simple Interest
Math MCQs

Question :    Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $11730 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $6900

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

Amount (A) = $11730

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 = $11730 – $6900 = $4830

Thus, Simple Interest = $4830

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 × 4830}/_{6900 × 7}

= ⁴⁸³⁰⁰⁰/₄₈₃₀₀

= 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) = $6900

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

Simple Interest = $4830 (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 $6900

= ⁷/₁₀₀ × 6900

= ^{7 × 6900}/₁₀₀

= ⁴⁸³⁰⁰/₁₀₀ = 483

Thus, simple Interest for 1 year = $483

Now,

∵ If the simple Interest is $483, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₈₃ years

∴ If the simple Interest is $4830, then the time = ¹/₄₈₃ × 4830 years

= ^{1 × 4830}/₄₈₃ years

= ⁴⁸³⁰/₄₈₃ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 5% simple interest?

(2) If Donald paid $5220 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(3) How much loan did Michelle borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8340 to clear it?

(4) Find the amount to be paid if Sarah borrowed a sum of $5850 at 6% simple interest for 7 years.

(5) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 2% simple interest.

(6) Find the amount to be paid if Michael borrowed a sum of $5300 at 9% simple interest for 8 years.

(7) Find the amount to be paid if James borrowed a sum of $5000 at 10% simple interest for 8 years.

(8) Calculate the amount due if Jennifer borrowed a sum of $3250 at 4% simple interest for 3 years.

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

(10) Find the amount to be paid if Sarah borrowed a sum of $5850 at 4% simple interest for 7 years.