Simple Interest
Math MCQs

Question :    Richard took a loan of $5200 at the rate of 10% simple interest per annum. If he paid an amount of $10400 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $5200

Rate of Simple Interest (R) = 10% per annum

Amount (A) = $10400

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 = $10400 – $5200 = $5200

Thus, Simple Interest = $5200

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 × 5200}/_{5200 × 10}

= ⁵²⁰⁰⁰⁰/₅₂₀₀₀

= 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) = $5200

Rate of Simple Interest (R) = 10% per annum

Simple Interest = $5200 (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 = 10% of Principal

= 10% of $5200

= ¹⁰/₁₀₀ × 5200

= ^{10 × 5200}/₁₀₀

= ⁵²⁰⁰⁰/₁₀₀ = 520

Thus, simple Interest for 1 year = $520

Now,

∵ If the simple Interest is $520, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₅₂₀ years

∴ If the simple Interest is $5200, then the time = ¹/₅₂₀ × 5200 years

= ^{1 × 5200}/₅₂₀ years

= ⁵²⁰⁰/₅₂₀ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) 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.

(2) How much loan did Patricia borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $5922.5 to clear it?

(3) What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 7% simple interest?

(4) Find the amount to be paid if Charles borrowed a sum of $5900 at 4% simple interest for 7 years.

(5) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $6864 to clear the loan, then find the time period of the loan.

(6) Find the amount to be paid if David borrowed a sum of $5400 at 7% simple interest for 8 years.

(7) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 7% simple interest.

(8) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $7740 to clear the loan, then find the time period of the loan.

(9) Joseph had to pay $4144 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.

(10) Find the amount to be paid if Barbara borrowed a sum of $5550 at 2% simple interest for 7 years.