Question:
Richard took a loan of $5200 at the rate of 6% simple interest per annum. If he paid an amount of $7384 to clear the loan, then find the time period of the loan.
Correct Answer
7
Solution And Explanation
Solution
Given,
Principal (P) = $5200
Rate of Simple Interest (R) = 6% per annum
Amount (A) = $7384
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 = $7384 – $5200 = $2184
Thus, Simple Interest = $2184
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 × 2184/5200 × 6
= 218400/31200
= 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) = $5200
Rate of Simple Interest (R) = 6% per annum
Simple Interest = $2184 (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 $5200
= 6/100 × 5200
= 6 × 5200/100
= 31200/100 = 312
Thus, simple Interest for 1 year = $312
Now,
∵ If the simple Interest is $312, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/312 years
∴ If the simple Interest is $2184, then the time = 1/312 × 2184 years
= 1 × 2184/312 years
= 2184/312 = 7 years
Thus, time (T) = 7 years Answer
Similar Questions
(1) What amount does Karen have to pay after 5 years if he takes a loan of $3950 at 3% simple interest?
(2) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 7% simple interest for 8 years.
(3) If Susan borrowed $3650 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(4) How much loan did Timothy borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8880 to clear it?
(5) Mark took a loan of $6800 at the rate of 10% simple interest per annum. If he paid an amount of $12920 to clear the loan, then find the time period of the loan.
(6) If Jennifer paid $3640 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(7) Mark took a loan of $6800 at the rate of 9% simple interest per annum. If he paid an amount of $11084 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if David borrowed a sum of $3400 at 2% simple interest for 4 years.
(9) Calculate the amount due if Thomas borrowed a sum of $3800 at 3% simple interest for 4 years.
(10) Find the amount to be paid if Mary borrowed a sum of $5050 at 4% simple interest for 7 years.