Question:
Joseph took a loan of $5400 at the rate of 7% simple interest per annum. If he paid an amount of $7668 to clear the loan, then find the time period of the loan.
Correct Answer
6
Solution And Explanation
Solution
Given,
Principal (P) = $5400
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $7668
Thus, time (T) = ?
Method (1) Using Formula
Calculation of Simple Interest, when Principal and Amount are givenFormual 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 = $7668 – $5400 = $2268
Thus, Simple Interest = $2268
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 × 2268/5400 × 7
= 226800/37800
= 6 years (using formula)
Thus, Time (T) = 6 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) = $5400
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $2268 (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 = 7% of Principal
= 7% of $5400
= 7/100 × 5400
= 7 × 5400/100
= 37800/100 = 378
Thus, simple Interest for 1 year = $378
Now,
∵ If the simple Interest is $378, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/378 years
∴ If the simple Interest is $2268, then the time = 1/378 × 2268 years
= 1 × 2268/378 years
= 2268/378 = 6 years
Thus, time (T) = 6 years Answer
Similar Questions
(1) If Steven paid $5520 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(2) Find the amount to be paid if Jessica borrowed a sum of $5750 at 7% simple interest for 7 years.
(3) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 8% simple interest?
(4) William took a loan of $5000 at the rate of 9% simple interest per annum. If he paid an amount of $7700 to clear the loan, then find the time period of the loan.
(5) Betty had to pay $4760 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(6) Calculate the amount due if Sarah borrowed a sum of $3850 at 7% simple interest for 4 years.
(7) Jessica had to pay $4312.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(8) Robert took a loan of $4200 at the rate of 9% simple interest per annum. If he paid an amount of $7602 to clear the loan, then find the time period of the loan.
(9) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $8976 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if Karen borrowed a sum of $3950 at 7% simple interest for 3 years.