Question:
Betty took a loan of $6500 at the rate of 9% simple interest per annum. If he paid an amount of $10595 to clear the loan, then find the time period of the loan.
Correct Answer
7
Solution And Explanation
Solution
Given,
Principal (P) = $6500
Rate of Simple Interest (R) = 9% per annum
Amount (A) = $10595
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 = $10595 – $6500 = $4095
Thus, Simple Interest = $4095
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 × 4095/6500 × 9
= 409500/58500
= 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) = $6500
Rate of Simple Interest (R) = 9% per annum
Simple Interest = $4095 (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 $6500
= 9/100 × 6500
= 9 × 6500/100
= 58500/100 = 585
Thus, simple Interest for 1 year = $585
Now,
∵ If the simple Interest is $585, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/585 years
∴ If the simple Interest is $4095, then the time = 1/585 × 4095 years
= 1 × 4095/585 years
= 4095/585 = 7 years
Thus, time (T) = 7 years Answer
Similar Questions
(1) Mark took a loan of $6800 at the rate of 6% simple interest per annum. If he paid an amount of $10472 to clear the loan, then find the time period of the loan.
(2) How much loan did Brian borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8640 to clear it?
(3) Calculate the amount due if Sarah borrowed a sum of $3850 at 8% simple interest for 4 years.
(4) Calculate the amount due after 10 years if Thomas borrowed a sum of $5800 at a rate of 4% simple interest.
(5) Michael took a loan of $4600 at the rate of 7% simple interest per annum. If he paid an amount of $7498 to clear the loan, then find the time period of the loan.
(6) If Mary borrowed $3050 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(7) What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 10% simple interest?
(8) Elizabeth took a loan of $4900 at the rate of 8% simple interest per annum. If he paid an amount of $7644 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if Mary borrowed a sum of $5050 at 7% simple interest for 7 years.
(10) If Sandra paid $5162 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.