Question:
Karen took a loan of $5900 at the rate of 8% simple interest per annum. If he paid an amount of $8732 to clear the loan, then find the time period of the loan.
Correct Answer
6
Solution And Explanation
Solution
Given,
Principal (P) = $5900
Rate of Simple Interest (R) = 8% per annum
Amount (A) = $8732
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 = $8732 – $5900 = $2832
Thus, Simple Interest = $2832
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 × 2832/5900 × 8
= 283200/47200
= 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) = $5900
Rate of Simple Interest (R) = 8% per annum
Simple Interest = $2832 (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 $5900
= 8/100 × 5900
= 8 × 5900/100
= 47200/100 = 472
Thus, simple Interest for 1 year = $472
Now,
∵ If the simple Interest is $472, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/472 years
∴ If the simple Interest is $2832, then the time = 1/472 × 2832 years
= 1 × 2832/472 years
= 2832/472 = 6 years
Thus, time (T) = 6 years Answer
Similar Questions
(1) Find the amount to be paid if William borrowed a sum of $5500 at 8% simple interest for 7 years.
(2) If Joshua paid $5292 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(3) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $8360 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if Mary borrowed a sum of $5050 at 2% simple interest for 8 years.
(5) Calculate the amount due if Michael borrowed a sum of $3300 at 5% simple interest for 3 years.
(6) Find the amount to be paid if Christopher borrowed a sum of $6000 at 3% simple interest for 8 years.
(7) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7647.5 to clear it?
(8) Calculate the amount due after 9 years if Barbara borrowed a sum of $5550 at a rate of 8% simple interest.
(9) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 7% simple interest?
(10) If Karen paid $4266 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.