Question:
Sarah took a loan of $5700 at the rate of 10% simple interest per annum. If he paid an amount of $9120 to clear the loan, then find the time period of the loan.
Correct Answer
6
Solution And Explanation
Solution
Given,
Principal (P) = $5700
Rate of Simple Interest (R) = 10% per annum
Amount (A) = $9120
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 = $9120 – $5700 = $3420
Thus, Simple Interest = $3420
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 × 3420/5700 × 10
= 342000/57000
= 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) = $5700
Rate of Simple Interest (R) = 10% per annum
Simple Interest = $3420 (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 $5700
= 10/100 × 5700
= 10 × 5700/100
= 57000/100 = 570
Thus, simple Interest for 1 year = $570
Now,
∵ If the simple Interest is $570, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/570 years
∴ If the simple Interest is $3420, then the time = 1/570 × 3420 years
= 1 × 3420/570 years
= 3420/570 = 6 years
Thus, time (T) = 6 years Answer
Similar Questions
(1) How much loan did Cynthia borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8745 to clear it?
(2) Mark took a loan of $6800 at the rate of 6% simple interest per annum. If he paid an amount of $9248 to clear the loan, then find the time period of the loan.
(3) David had to pay $3808 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(4) Patricia took a loan of $4300 at the rate of 9% simple interest per annum. If he paid an amount of $7783 to clear the loan, then find the time period of the loan.
(5) Find the amount to be paid if James borrowed a sum of $5000 at 6% simple interest for 7 years.
(6) What amount does John have to pay after 5 years if he takes a loan of $3200 at 6% simple interest?
(7) If Richard paid $4176 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(8) Robert took a loan of $4200 at the rate of 6% simple interest per annum. If he paid an amount of $6468 to clear the loan, then find the time period of the loan.
(9) Anthony took a loan of $6600 at the rate of 9% simple interest per annum. If he paid an amount of $10758 to clear the loan, then find the time period of the loan.
(10) David had to pay $3910 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.