Question:
John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $7920 to clear the loan, then find the time period of the loan.
Correct Answer
8
Solution And Explanation
Solution
Given,
Principal (P) = $4400
Rate of Simple Interest (R) = 10% per annum
Amount (A) = $7920
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 = $7920 – $4400 = $3520
Thus, Simple Interest = $3520
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 × 3520/4400 × 10
= 352000/44000
= 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) = $4400
Rate of Simple Interest (R) = 10% per annum
Simple Interest = $3520 (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 = 10% of Principal
= 10% of $4400
= 10/100 × 4400
= 10 × 4400/100
= 44000/100 = 440
Thus, simple Interest for 1 year = $440
Now,
∵ If the simple Interest is $440, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/440 years
∴ If the simple Interest is $3520, then the time = 1/440 × 3520 years
= 1 × 3520/440 years
= 3520/440 = 8 years
Thus, time (T) = 8 years Answer
Similar Questions
(1) Calculate the amount due if Barbara borrowed a sum of $3550 at 2% simple interest for 3 years.
(2) Jennifer took a loan of $4500 at the rate of 6% simple interest per annum. If he paid an amount of $6120 to clear the loan, then find the time period of the loan.
(3) What amount does David have to pay after 5 years if he takes a loan of $3400 at 8% simple interest?
(4) What amount will be due after 2 years if Robert borrowed a sum of $3050 at a 6% simple interest?
(5) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $8772 to clear the loan, then find the time period of the loan.
(6) What amount does Richard have to pay after 5 years if he takes a loan of $3600 at 6% simple interest?
(7) How much loan did Steven borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7920 to clear it?
(8) Calculate the amount due after 9 years if Barbara borrowed a sum of $5550 at a rate of 10% simple interest.
(9) Calculate the amount due if Christopher borrowed a sum of $4000 at 8% simple interest for 3 years.
(10) Christopher had to pay $4600 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.