Simple Interest
Math MCQs

Question :  ( 1 of 10 )  Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $10260 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $5400

Rate of Simple Interest (R) = 9% per annum

Amount (A) = $10260

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 = $10260 – $5400 = $4860

Thus, Simple Interest = $4860

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 × 4860}/_{5400 × 9}

= ⁴⁸⁶⁰⁰⁰/₄₈₆₀₀

= 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) = $5400

Rate of Simple Interest (R) = 9% per annum

Simple Interest = $4860 (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 = 9% of Principal

= 9% of $5400

= ⁹/₁₀₀ × 5400

= ^{9 × 5400}/₁₀₀

= ⁴⁸⁶⁰⁰/₁₀₀ = 486

Thus, simple Interest for 1 year = $486

Now,

∵ If the simple Interest is $486, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₄₈₆ years

∴ If the simple Interest is $4860, then the time = ¹/₄₈₆ × 4860 years

= ^{1 × 4860}/₄₈₆ years

= ⁴⁸⁶⁰/₄₈₆ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) How much loan did William borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6875 to clear it?

(2) Find the amount to be paid if Patricia borrowed a sum of $5150 at 5% simple interest for 7 years.

(3) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $9514 to clear the loan, then find the time period of the loan.

(4) Mark had to pay $4664 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.

(5) What amount does Karen have to pay after 5 years if he takes a loan of $3950 at 3% simple interest?

(6) Calculate the amount due if Mary borrowed a sum of $3050 at 6% simple interest for 3 years.

(7) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $8580 to clear the loan, then find the time period of the loan.

(8) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 6% simple interest for 4 years.

(9) How much loan did Jeffrey borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8970 to clear it?

(10) If Jennifer borrowed $3250 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.