Cambridge International Mathematics

216 Topics in arithmetic (Chapter 10)

Example 9 Self Tutor

I= 5000

n=4

P= 17 000

Now I=Prn

) 5000 = 17 000£r£ 4

) 68 000r= 5000

) r=

5000

68 000

fdividing both sides by68 000g

) r¼ 0 : 0735

) you would need to charge a rate of 7 :35%p.a. simple interest.

Example 10 Self Tutor

How long would it take to earn interest of$4000on a loan of$15 000if a

rate of 7 :5%p.a. simple interest is charged?

I= 4000

P= 15 000

r=7: 5 ¥100 = 0: 075

Now I=Prn

) 4000 = 15 000£ 0 : 075 £n

) 4000 = 1125n

) n¼ 3 : 56

So, it would take 3 years 7 months to earn the interest.

EXERCISE 10C.2

1 Calculate the simple interest on a loan of:

a $2000at a rate of6%p.a. over 4 years

b $ 9600 at a rate of 7 :3%p.a. over a 17 month period

c $30 000at a rate of 6 :8%p.a. over a 5 year 4 month period

d E 7500 at a rate of 7 :6%p.a. over a 278 day period.

2 Which loan charges less simple interest?

$25 000at a rate of7%p.a. for 4 years or $25 000at a rate of 6 :75%p.a. for 412 years

3

a $800after 5 years on$6000 b E 1000 after 20 months onE 8800?

4

5

What rate of simple interest per annum would need to be charged

on a loan of if you wanted to earn in interest over

years?

$$20 000 3000

2

¡

If you wanted to earn in interest on a year loan of , what

rate of simple interest per annum would you need to charge?

$5000 4 $17 000¡

What rate of simple interest per annum must be charged if you want to earn:

Monique wants to buy a television costing in months’

time. She has already saved and deposits this in an account

that pays simple interest. What annual rate of interest must the

account pay to enable the student to reach her target?

$1500 18

$1300

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Y:\HAESE\IGCSE01\IG01_10\216IGCSE01_10.CDR Friday, 14 November 2008 12:09:04 PM PETER