Question:
Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $8960 to clear the loan, then find the time period of the loan.
Correct Answer
6
Solution And Explanation
Solution
Given,
Principal (P) = $5600
Rate of Simple Interest (R) = 10% per annum
Amount (A) = $8960
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 = $8960 – $5600 = $3360
Thus, Simple Interest = $3360
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 × 3360/5600 × 10
= 336000/56000
= 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) = $5600
Rate of Simple Interest (R) = 10% per annum
Simple Interest = $3360 (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 $5600
= 10/100 × 5600
= 10 × 5600/100
= 56000/100 = 560
Thus, simple Interest for 1 year = $560
Now,
∵ If the simple Interest is $560, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/560 years
∴ If the simple Interest is $3360, then the time = 1/560 × 3360 years
= 1 × 3360/560 years
= 3360/560 = 6 years
Thus, time (T) = 6 years Answer
Similar Questions
(1) Find the amount to be paid if John borrowed a sum of $5200 at 2% simple interest for 7 years.
(2) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $10320 to clear the loan, then find the time period of the loan.
(3) Elizabeth had to pay $3864 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(4) Calculate the amount due if James borrowed a sum of $3000 at 6% simple interest for 3 years.
(5) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 10% simple interest?
(6) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 7% simple interest?
(7) If Karen paid $4582 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(8) Calculate the amount due if Charles borrowed a sum of $3900 at 8% simple interest for 4 years.
(9) Calculate the amount due if Jessica borrowed a sum of $3750 at 7% simple interest for 4 years.
(10) If Jennifer borrowed $3250 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.