Question:
Susan took a loan of $5300 at the rate of 8% simple interest per annum. If he paid an amount of $8692 to clear the loan, then find the time period of the loan.
Correct Answer
8
Solution And Explanation
Solution
Given,
Principal (P) = $5300
Rate of Simple Interest (R) = 8% per annum
Amount (A) = $8692
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 = $8692 – $5300 = $3392
Thus, Simple Interest = $3392
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 × 3392/5300 × 8
= 339200/42400
= 8 years (using formula)
Thus, Time (T) = 8 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) = $5300
Rate of Simple Interest (R) = 8% per annum
Simple Interest = $3392 (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 = 8% of Principal
= 8% of $5300
= 8/100 × 5300
= 8 × 5300/100
= 42400/100 = 424
Thus, simple Interest for 1 year = $424
Now,
∵ If the simple Interest is $424, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/424 years
∴ If the simple Interest is $3392, then the time = 1/424 × 3392 years
= 1 × 3392/424 years
= 3392/424 = 8 years
Thus, time (T) = 8 years Answer
Similar Questions
(1) 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.
(2) What amount does Mary have to pay after 5 years if he takes a loan of $3050 at 6% simple interest?
(3) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 10% simple interest?
(4) Find the amount to be paid if Barbara borrowed a sum of $5550 at 6% simple interest for 7 years.
(5) Charles took a loan of $5800 at the rate of 8% simple interest per annum. If he paid an amount of $10440 to clear the loan, then find the time period of the loan.
(6) Mark took a loan of $6800 at the rate of 8% simple interest per annum. If he paid an amount of $12240 to clear the loan, then find the time period of the loan.
(7) Find the amount to be paid if Susan borrowed a sum of $5650 at 8% simple interest for 7 years.
(8) Calculate the amount due if Patricia borrowed a sum of $3150 at 3% simple interest for 4 years.
(9) Kimberly had to pay $5347.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(10) Joseph took a loan of $5400 at the rate of 8% simple interest per annum. If he paid an amount of $9720 to clear the loan, then find the time period of the loan.