Question:
Sandra took a loan of $6900 at the rate of 7% simple interest per annum. If he paid an amount of $9798 to clear the loan, then find the time period of the loan.
Correct Answer
6
Solution And Explanation
Solution
Given,
Principal (P) = $6900
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $9798
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 = $9798 – $6900 = $2898
Thus, Simple Interest = $2898
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 × 2898/6900 × 7
= 289800/48300
= 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) = $6900
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $2898 (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 $6900
= 7/100 × 6900
= 7 × 6900/100
= 48300/100 = 483
Thus, simple Interest for 1 year = $483
Now,
∵ If the simple Interest is $483, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/483 years
∴ If the simple Interest is $2898, then the time = 1/483 × 2898 years
= 1 × 2898/483 years
= 2898/483 = 6 years
Thus, time (T) = 6 years Answer
Similar Questions
(1) Calculate the amount due if Thomas borrowed a sum of $3800 at 2% simple interest for 3 years.
(2) Karen took a loan of $5900 at the rate of 7% simple interest per annum. If he paid an amount of $9617 to clear the loan, then find the time period of the loan.
(3) Jennifer took a loan of $4500 at the rate of 10% simple interest per annum. If he paid an amount of $8100 to clear the loan, then find the time period of the loan.
(4) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 9% simple interest?
(5) Calculate the amount due after 9 years if Charles borrowed a sum of $5900 at a rate of 4% simple interest.
(6) Mary took a loan of $4100 at the rate of 10% simple interest per annum. If he paid an amount of $6560 to clear the loan, then find the time period of the loan.
(7) What amount will be due after 2 years if Christopher borrowed a sum of $3500 at a 8% simple interest?
(8) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 5% simple interest?
(9) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $10452 to clear the loan, then find the time period of the loan.
(10) Find the amount to be paid if David borrowed a sum of $5400 at 6% simple interest for 8 years.