Simple Interest
Math MCQs

Question :    Mark took a loan of $6800 at the rate of 9% simple interest per annum. If he paid an amount of $12920 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) = 9% per annum

Amount (A) = $12920

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 = $12920 – $6800 = $6120

Thus, Simple Interest = $6120

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 × 6120}/_{6800 × 9}

= ⁶¹²⁰⁰⁰/₆₁₂₀₀

= 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) = 9% per annum

Simple Interest = $6120 (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 $6800

= ⁹/₁₀₀ × 6800

= ^{9 × 6800}/₁₀₀

= ⁶¹²⁰⁰/₁₀₀ = 612

Thus, simple Interest for 1 year = $612

Now,

∵ If the simple Interest is $612, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₆₁₂ years

∴ If the simple Interest is $6120, then the time = ¹/₆₁₂ × 6120 years

= ^{1 × 6120}/₆₁₂ years

= ⁶¹²⁰/₆₁₂ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) Find the amount to be paid if Mary borrowed a sum of $5050 at 5% simple interest for 8 years.

(2) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 2% simple interest?

(3) Calculate the amount due if Patricia borrowed a sum of $3150 at 2% simple interest for 4 years.

(4) Thomas took a loan of $5600 at the rate of 8% simple interest per annum. If he paid an amount of $8288 to clear the loan, then find the time period of the loan.

(5) How much loan did Kenneth borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8050 to clear it?

(6) How much loan did Nancy borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6765 to clear it?

(7) In how much time a principal of $3100 will amount to $3410 at a simple interest of 5% per annum?

(8) William took a loan of $5000 at the rate of 10% simple interest per annum. If he paid an amount of $10000 to clear the loan, then find the time period of the loan.

(9) If Jennifer borrowed $3250 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.

(10) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 10% simple interest?