Simple Interest
Math MCQs

Question :    Mark took a loan of $6800 at the rate of 8% simple interest per annum. If he paid an amount of $12240 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $6800

Rate of Simple Interest (R) = 8% per annum

Amount (A) = $12240

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 = $12240 – $6800 = $5440

Thus, Simple Interest = $5440

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 × 5440}/_{6800 × 8}

= ⁵⁴⁴⁰⁰⁰/₅₄₄₀₀

= 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) = $6800

Rate of Simple Interest (R) = 8% per annum

Simple Interest = $5440 (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 = 8% of Principal

= 8% of $6800

= ⁸/₁₀₀ × 6800

= ^{8 × 6800}/₁₀₀

= ⁵⁴⁴⁰⁰/₁₀₀ = 544

Thus, simple Interest for 1 year = $544

Now,

∵ If the simple Interest is $544, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₅₄₄ years

∴ If the simple Interest is $5440, then the time = ¹/₅₄₄ × 5440 years

= ^{1 × 5440}/₅₄₄ years

= ⁵⁴⁴⁰/₅₄₄ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) Find the amount to be paid if Linda borrowed a sum of $5350 at 6% simple interest for 7 years.

(2) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $7526 to clear the loan, then find the time period of the loan.

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

(4) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 6% simple interest.

(5) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 7% simple interest?

(6) Calculate the amount due if Jessica borrowed a sum of $3750 at 5% simple interest for 4 years.

(7) Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $11050 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 7% simple interest for 8 years.

(9) Calculate the amount due if Thomas borrowed a sum of $3800 at 8% simple interest for 4 years.

(10) How much loan did Mark borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8000 to clear it?