Question:
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.
Correct Answer
6
Solution And Explanation
Solution
Given,
Principal (P) = $4500
Rate of Simple Interest (R) = 8% per annum
Amount (A) = $6660
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 = $6660 – $4500 = $2160
Thus, Simple Interest = $2160
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 × 2160/4500 × 8
= 216000/36000
= 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) = $4500
Rate of Simple Interest (R) = 8% per annum
Simple Interest = $2160 (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 = 8% of Principal
= 8% of $4500
= 8/100 × 4500
= 8 × 4500/100
= 36000/100 = 360
Thus, simple Interest for 1 year = $360
Now,
∵ If the simple Interest is $360, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/360 years
∴ If the simple Interest is $2160, then the time = 1/360 × 2160 years
= 1 × 2160/360 years
= 2160/360 = 6 years
Thus, time (T) = 6 years Answer
Similar Questions
(1) If Margaret paid $4698 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(2) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $8580 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Sarah borrowed a sum of $5850 at 4% simple interest for 8 years.
(4) Calculate the amount due if Joseph borrowed a sum of $3700 at 8% simple interest for 3 years.
(5) What amount will be due after 2 years if Christopher borrowed a sum of $3500 at a 7% simple interest?
(6) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 5% simple interest.
(7) In how much time a principal of $3150 will amount to $3465 at a simple interest of 5% per annum?
(8) What amount does Charles have to pay after 5 years if he takes a loan of $3900 at 7% simple interest?
(9) If Michelle paid $5940 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(10) Calculate the amount due after 9 years if David borrowed a sum of $5400 at a rate of 7% simple interest.