Question:
Jennifer took a loan of $4500 at the rate of 6% simple interest per annum. If he paid an amount of $6390 to clear the loan, then find the time period of the loan.
Correct Answer
7
Solution And Explanation
Solution
Given,
Principal (P) = $4500
Rate of Simple Interest (R) = 6% per annum
Amount (A) = $6390
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 = $6390 – $4500 = $1890
Thus, Simple Interest = $1890
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 × 1890/4500 × 6
= 189000/27000
= 7 years (using formula)
Thus, Time (T) = 7 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) = $4500
Rate of Simple Interest (R) = 6% per annum
Simple Interest = $1890 (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 = 6% of Principal
= 6% of $4500
= 6/100 × 4500
= 6 × 4500/100
= 27000/100 = 270
Thus, simple Interest for 1 year = $270
Now,
∵ If the simple Interest is $270, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/270 years
∴ If the simple Interest is $1890, then the time = 1/270 × 1890 years
= 1 × 1890/270 years
= 1890/270 = 7 years
Thus, time (T) = 7 years Answer
Similar Questions
(1) What amount does David have to pay after 6 years if he takes a loan of $3400 at 6% simple interest?
(2) Richard took a loan of $5200 at the rate of 8% simple interest per annum. If he paid an amount of $8112 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Robert borrowed a sum of $5100 at 3% simple interest for 7 years.
(4) Calculate the amount due if Charles borrowed a sum of $3900 at 10% simple interest for 3 years.
(5) If Christopher paid $4640 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(6) How much loan did Laura borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8635 to clear it?
(7) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 7% simple interest for 8 years.
(8) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 8% simple interest.
(9) How much loan did Dorothy borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8337.5 to clear it?
(10) Patricia took a loan of $4300 at the rate of 7% simple interest per annum. If he paid an amount of $6407 to clear the loan, then find the time period of the loan.