Question:
Joseph took a loan of $5400 at the rate of 10% simple interest per annum. If he paid an amount of $8640 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) = 10% per annum
Amount (A) = $8640
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 = $8640 – $5400 = $3240
Thus, Simple Interest = $3240
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 × 3240/5400 × 10
= 324000/54000
= 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) = 10% per annum
Simple Interest = $3240 (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 = 10% of Principal
= 10% of $5400
= 10/100 × 5400
= 10 × 5400/100
= 54000/100 = 540
Thus, simple Interest for 1 year = $540
Now,
∵ If the simple Interest is $540, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/540 years
∴ If the simple Interest is $3240, then the time = 1/540 × 3240 years
= 1 × 3240/540 years
= 3240/540 = 6 years
Thus, time (T) = 6 years Answer
Similar Questions
(1) Richard took a loan of $5200 at the rate of 7% simple interest per annum. If he paid an amount of $8476 to clear the loan, then find the time period of the loan.
(2) James took a loan of $4000 at the rate of 6% simple interest per annum. If he paid an amount of $5680 to clear the loan, then find the time period of the loan.
(3) Susan took a loan of $5300 at the rate of 8% simple interest per annum. If he paid an amount of $9116 to clear the loan, then find the time period of the loan.
(4) If Ashley paid $5278 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 will be due after 2 years if Robert borrowed a sum of $3050 at a 7% simple interest?
(6) David took a loan of $4800 at the rate of 7% simple interest per annum. If he paid an amount of $6816 to clear the loan, then find the time period of the loan.
(7) If Robert borrowed $3100 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(8) How much loan did Jason borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8470 to clear it?
(9) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 5% simple interest?
(10) Calculate the amount due if Richard borrowed a sum of $3600 at 3% simple interest for 3 years.