Simple Interest
Math MCQs

Question :    Betty took a loan of $6500 at the rate of 10% simple interest per annum. If he paid an amount of $13000 to clear the loan, then find the time period of the loan.

Correct Answer  10

Solution & Explanation

Solution

Given,

Principal (P) = $6500

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

Amount (A) = $13000

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 = $13000 – $6500 = $6500

Thus, Simple Interest = $6500

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 × 6500}/_{6500 × 10}

= ⁶⁵⁰⁰⁰⁰/₆₅₀₀₀

= 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) = $6500

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

Simple Interest = $6500 (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 $6500

= ¹⁰/₁₀₀ × 6500

= ^{10 × 6500}/₁₀₀

= ⁶⁵⁰⁰⁰/₁₀₀ = 650

Thus, simple Interest for 1 year = $650

Now,

∵ If the simple Interest is $650, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₆₅₀ years

∴ If the simple Interest is $6500, then the time = ¹/₆₅₀ × 6500 years

= ^{1 × 6500}/₆₅₀ years

= ⁶⁵⁰⁰/₆₅₀ = 10 years

Thus, time (T) = 10 years Answer

Similar Questions

(1) Daniel took a loan of $6200 at the rate of 7% simple interest per annum. If he paid an amount of $8804 to clear the loan, then find the time period of the loan.

(2) How much loan did Jason borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8855 to clear it?

(3) Find the amount to be paid if James borrowed a sum of $5000 at 4% simple interest for 7 years.

(4) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 6% simple interest?

(5) If Sarah paid $4620 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.

(6) Richard took a loan of $5200 at the rate of 8% simple interest per annum. If he paid an amount of $8944 to clear the loan, then find the time period of the loan.

(7) Find the amount to be paid if Sarah borrowed a sum of $5850 at 2% simple interest for 7 years.

(8) Calculate the amount due after 9 years if Joseph borrowed a sum of $5700 at a rate of 6% simple interest.

(9) What amount does Charles have to pay after 5 years if he takes a loan of $3900 at 2% simple interest?

(10) James took a loan of $4000 at the rate of 7% simple interest per annum. If he paid an amount of $6520 to clear the loan, then find the time period of the loan.