Question:
Joshua had to pay $5341 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
Correct Answer
$4900
Solution And Explanation
Solution
Given,
Amount (A) = $5341
Rate of Simple Interest (R) = 3%
Time (T) = 3 years
Thus, Principal (P) = ?
Method (1) Using Formula
Calculation of the Principal using forumula when Amount, Time and Rate of Simple Interest are given
Formula to find the Principal (P)
Amount (A) = Principal (P) + Principal (P) × Rate (R) × Time (T)
⇒ Amount (A) = Principal (P) [1 + Rate (R) × Time (T)]
⇒ A = P (1 + RT)
Using the formula to find the Amount (A), the fourth can be calculated if any three of A, P, R, and T are given
In the given question, we need to find the Principal (P)
Therefore, by substituting, Amount, Rate, and Time, in the formula A = P (1 + RT) we get
$5341 = P (1 + 3% × 3)
⇒ $5341 = P (1 + 3/100 × 3)
⇒ $5341 = P (1 + 3 × 3/100)
⇒ $5341 = P (1 + 9/100)
⇒ $5341 = P (100 + 9/100)
⇒ $5341 = P × 109/100
⇒ P × 109/100 = $5341
⇒ P = 5341/109/100
⇒ P = 5341 × 100/109
⇒ P = 5341 × 100/109
⇒ P = 534100/109
⇒ P = $4900
Thus, the sum borrowed (P) = $4900 Answer
Method (1) Using Unitary Method
Calculation of the Principal using unitary method when Amount, Time and Rate of Simple Interest are given
Calculation of the Simple Interest
Let, the principal = 100
Here, since rate of simple interest = 3% per annum
Thus, Interest = 3% of principal
⇒ Interest = 3% of 100 = 3
Thus, Simple Interest for 1 year = 3
Calculation of the Amount
Since, in the question, time = 3 years
So, we need to calculate the simple interest for the given time period, which is 3 years
Thus, Simple Interest for 3 years = 3 × Simple Interest for 1 year
= 3 × 3 = 9
Thus, simple interest for 3 years = 9
Thus, Amount (A) = Principal + Interest
⇒ Amount = 100 + 9 = 109
Calculation of the Principal
Now,
∵ If the Amount is 109, then the Principal = 100
∴ If the Amount is 1, then the Principal = 100/109
∴ If the Amount is 5341, then the Principal = 100/109 × 5341
= 100 × 5341/109
= 534100/109
= 4900
Thus, Principal = $4900
Thus, the sum borrowed = $4900 Answer
Similar Questions
(1) Thomas had to pay $4370 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(2) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 4% simple interest?
(3) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $8639 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due if James borrowed a sum of $3000 at 2% simple interest for 3 years.
(5) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $12060 to clear the loan, then find the time period of the loan.
(6) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $6660 to clear the loan, then find the time period of the loan.
(7) How much loan did George borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8030 to clear it?
(8) Find the amount to be paid if Susan borrowed a sum of $5650 at 10% simple interest for 7 years.
(9) Michael took a loan of $4600 at the rate of 10% simple interest per annum. If he paid an amount of $7360 to clear the loan, then find the time period of the loan.
(10) Jessica took a loan of $5500 at the rate of 9% simple interest per annum. If he paid an amount of $9460 to clear the loan, then find the time period of the loan.