Question:
Joseph took a loan of $5400 at the rate of 8% simple interest per annum. If he paid an amount of $9288 to clear the loan, then find the time period of the loan.
Correct Answer
9
Solution And Explanation
Solution
Given,
Principal (P) = $5400
Rate of Simple Interest (R) = 8% per annum
Amount (A) = $9288
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 = $9288 – $5400 = $3888
Thus, Simple Interest = $3888
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 × 3888/5400 × 8
= 388800/43200
= 9 years (using formula)
Thus, Time (T) = 9 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) = 8% per annum
Simple Interest = $3888 (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 $5400
= 8/100 × 5400
= 8 × 5400/100
= 43200/100 = 432
Thus, simple Interest for 1 year = $432
Now,
∵ If the simple Interest is $432, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/432 years
∴ If the simple Interest is $3888, then the time = 1/432 × 3888 years
= 1 × 3888/432 years
= 3888/432 = 9 years
Thus, time (T) = 9 years Answer
Similar Questions
(1) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $10212 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 5% simple interest.
(3) If Lisa paid $4860 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(4) Calculate the amount due if Sarah borrowed a sum of $3850 at 2% simple interest for 3 years.
(5) Find the amount to be paid if James borrowed a sum of $5000 at 6% simple interest for 8 years.
(6) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 10% simple interest.
(7) How much loan did Sandra borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $8062.5 to clear it?
(8) If Charles paid $4212 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(9) Find the amount to be paid if Susan borrowed a sum of $5650 at 2% simple interest for 7 years.
(10) How much loan did Edward borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9500 to clear it?