Question:
Barbara took a loan of $5100 at the rate of 7% simple interest per annum. If he paid an amount of $7599 to clear the loan, then find the time period of the loan.
Correct Answer
7
Solution And Explanation
Solution
Given,
Principal (P) = $5100
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $7599
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 = $7599 – $5100 = $2499
Thus, Simple Interest = $2499
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 × 2499/5100 × 7
= 249900/35700
= 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) = $5100
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $2499 (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 = 7% of Principal
= 7% of $5100
= 7/100 × 5100
= 7 × 5100/100
= 35700/100 = 357
Thus, simple Interest for 1 year = $357
Now,
∵ If the simple Interest is $357, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/357 years
∴ If the simple Interest is $2499, then the time = 1/357 × 2499 years
= 1 × 2499/357 years
= 2499/357 = 7 years
Thus, time (T) = 7 years Answer
Similar Questions
(1) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 6% simple interest?
(2) Calculate the amount due if Susan borrowed a sum of $3650 at 7% simple interest for 4 years.
(3) Margaret had to pay $4741.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(4) Michelle had to pay $5544 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(5) How much loan did Sharon borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8912.5 to clear it?
(6) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $11780 to clear the loan, then find the time period of the loan.
(7) Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $7335 to clear the loan, then find the time period of the loan.
(8) Linda took a loan of $4700 at the rate of 10% simple interest per annum. If he paid an amount of $7990 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if David borrowed a sum of $5400 at 3% simple interest for 7 years.
(10) Mark took a loan of $6800 at the rate of 8% simple interest per annum. If he paid an amount of $10064 to clear the loan, then find the time period of the loan.