Question:
James took a loan of $4000 at the rate of 9% simple interest per annum. If he paid an amount of $7240 to clear the loan, then find the time period of the loan.
Correct Answer
9
Solution And Explanation
Solution
Given,
Principal (P) = $4000
Rate of Simple Interest (R) = 9% per annum
Amount (A) = $7240
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 = $7240 – $4000 = $3240
Thus, Simple Interest = $3240
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 × 3240/4000 × 9
= 324000/36000
= 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) = $4000
Rate of Simple Interest (R) = 9% per annum
Simple Interest = $3240 (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 $4000
= 9/100 × 4000
= 9 × 4000/100
= 36000/100 = 360
Thus, simple Interest for 1 year = $360
Now,
∵ If the simple Interest is $360, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/360 years
∴ If the simple Interest is $3240, then the time = 1/360 × 3240 years
= 1 × 3240/360 years
= 3240/360 = 9 years
Thus, time (T) = 9 years Answer
Similar Questions
(1) Karen took a loan of $5900 at the rate of 10% simple interest per annum. If he paid an amount of $10620 to clear the loan, then find the time period of the loan.
(2) Linda took a loan of $4700 at the rate of 6% simple interest per annum. If he paid an amount of $6956 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Thomas borrowed a sum of $5800 at 7% simple interest for 8 years.
(4) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 2% simple interest?
(5) How much loan did Paul borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8040 to clear it?
(6) Karen took a loan of $5900 at the rate of 7% simple interest per annum. If he paid an amount of $10030 to clear the loan, then find the time period of the loan.
(7) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 10% simple interest for 8 years.
(8) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 6% simple interest?
(9) If James paid $3240 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(10) Calculate the amount due if Mary borrowed a sum of $3050 at 8% simple interest for 4 years.