Question:
Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $10212 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) = 8% per annum
Amount (A) = $10212
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 = $10212 – $6900 = $3312
Thus, Simple Interest = $3312
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 × 3312/6900 × 8
= 331200/55200
= 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) = 8% per annum
Simple Interest = $3312 (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 $6900
= 8/100 × 6900
= 8 × 6900/100
= 55200/100 = 552
Thus, simple Interest for 1 year = $552
Now,
∵ If the simple Interest is $552, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/552 years
∴ If the simple Interest is $3312, then the time = 1/552 × 3312 years
= 1 × 3312/552 years
= 3312/552 = 6 years
Thus, time (T) = 6 years Answer
Similar Questions
(1) How much loan did Matthew borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7750 to clear it?
(2) Robert took a loan of $4200 at the rate of 7% simple interest per annum. If he paid an amount of $5964 to clear the loan, then find the time period of the loan.
(3) Calculate the amount due if Sarah borrowed a sum of $3850 at 8% simple interest for 3 years.
(4) If Andrew paid $5568 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(5) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 5% simple interest?
(6) Margaret took a loan of $6700 at the rate of 10% simple interest per annum. If he paid an amount of $10720 to clear the loan, then find the time period of the loan.
(7) Charles took a loan of $5800 at the rate of 7% simple interest per annum. If he paid an amount of $9454 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if John borrowed a sum of $3200 at 5% simple interest for 4 years.
(9) Find the amount to be paid if Charles borrowed a sum of $5900 at 2% simple interest for 7 years.
(10) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 4% simple interest.