Question:
Michael took a loan of $4600 at the rate of 9% simple interest per annum. If he paid an amount of $8326 to clear the loan, then find the time period of the loan.
Correct Answer
9
Solution And Explanation
Solution
Given,
Principal (P) = $4600
Rate of Simple Interest (R) = 9% per annum
Amount (A) = $8326
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 = $8326 – $4600 = $3726
Thus, Simple Interest = $3726
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 × 3726/4600 × 9
= 372600/41400
= 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) = $4600
Rate of Simple Interest (R) = 9% per annum
Simple Interest = $3726 (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 $4600
= 9/100 × 4600
= 9 × 4600/100
= 41400/100 = 414
Thus, simple Interest for 1 year = $414
Now,
∵ If the simple Interest is $414, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/414 years
∴ If the simple Interest is $3726, then the time = 1/414 × 3726 years
= 1 × 3726/414 years
= 3726/414 = 9 years
Thus, time (T) = 9 years Answer
Similar Questions
(1) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $9900 to clear the loan, then find the time period of the loan.
(2) What amount does James have to pay after 5 years if he takes a loan of $3000 at 6% simple interest?
(3) Find the amount to be paid if Richard borrowed a sum of $5600 at 2% simple interest for 8 years.
(4) How much loan did Jeffrey borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9360 to clear it?
(5) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $8360 to clear the loan, then find the time period of the loan.
(6) If Margaret paid $5220 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(7) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 8% simple interest?
(8) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 2% simple interest.
(9) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 7% simple interest.
(10) Patricia took a loan of $4300 at the rate of 8% simple interest per annum. If he paid an amount of $7740 to clear the loan, then find the time period of the loan.