Question:
Patricia took a loan of $4300 at the rate of 9% simple interest per annum. If he paid an amount of $7396 to clear the loan, then find the time period of the loan.
Correct Answer
8
Solution And Explanation
Solution
Given,
Principal (P) = $4300
Rate of Simple Interest (R) = 9% per annum
Amount (A) = $7396
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 = $7396 – $4300 = $3096
Thus, Simple Interest = $3096
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 × 3096/4300 × 9
= 309600/38700
= 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) = $4300
Rate of Simple Interest (R) = 9% per annum
Simple Interest = $3096 (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 $4300
= 9/100 × 4300
= 9 × 4300/100
= 38700/100 = 387
Thus, simple Interest for 1 year = $387
Now,
∵ If the simple Interest is $387, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/387 years
∴ If the simple Interest is $3096, then the time = 1/387 × 3096 years
= 1 × 3096/387 years
= 3096/387 = 8 years
Thus, time (T) = 8 years Answer
Similar Questions
(1) If Richard borrowed $3600 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(2) If John borrowed $3200 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(3) Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $9324 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if Linda borrowed a sum of $5350 at 4% simple interest for 7 years.
(5) Joshua had to pay $5341 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(6) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $10560 to clear the loan, then find the time period of the loan.
(7) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 8% simple interest?
(8) Calculate the amount due if Jennifer borrowed a sum of $3250 at 5% simple interest for 4 years.
(9) Find the amount to be paid if Richard borrowed a sum of $5600 at 6% simple interest for 8 years.
(10) Mark had to pay $4664 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.