Question:
Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $8802 to clear the loan, then find the time period of the loan.
Correct Answer
7
Solution And Explanation
Solution
Given,
Principal (P) = $5400
Rate of Simple Interest (R) = 9% per annum
Amount (A) = $8802
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 = $8802 – $5400 = $3402
Thus, Simple Interest = $3402
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 × 3402/5400 × 9
= 340200/48600
= 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) = $5400
Rate of Simple Interest (R) = 9% per annum
Simple Interest = $3402 (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 = 9% of Principal
= 9% of $5400
= 9/100 × 5400
= 9 × 5400/100
= 48600/100 = 486
Thus, simple Interest for 1 year = $486
Now,
∵ If the simple Interest is $486, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/486 years
∴ If the simple Interest is $3402, then the time = 1/486 × 3402 years
= 1 × 3402/486 years
= 3402/486 = 7 years
Thus, time (T) = 7 years Answer
Similar Questions
(1) Calculate the amount due after 9 years if William borrowed a sum of $5500 at a rate of 4% simple interest.
(2) Calculate the amount due if Robert borrowed a sum of $3100 at 9% simple interest for 4 years.
(3) Calculate the amount due if Barbara borrowed a sum of $3550 at 8% simple interest for 3 years.
(4) Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 8% simple interest.
(5) Jennifer took a loan of $4500 at the rate of 9% simple interest per annum. If he paid an amount of $6930 to clear the loan, then find the time period of the loan.
(6) In how much time a principal of $3150 will amount to $3622.5 at a simple interest of 3% per annum?
(7) Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $7020 to clear the loan, then find the time period of the loan.
(8) Find the amount to be paid if David borrowed a sum of $5400 at 3% simple interest for 8 years.
(9) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 4% simple interest for 3 years.
(10) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 9% simple interest?