Question:
Linda took a loan of $4700 at the rate of 9% simple interest per annum. If he paid an amount of $8507 to clear the loan, then find the time period of the loan.
Correct Answer
9
Solution And Explanation
Solution
Given,
Principal (P) = $4700
Rate of Simple Interest (R) = 9% per annum
Amount (A) = $8507
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 = $8507 – $4700 = $3807
Thus, Simple Interest = $3807
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 × 3807/4700 × 9
= 380700/42300
= 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) = $4700
Rate of Simple Interest (R) = 9% per annum
Simple Interest = $3807 (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 $4700
= 9/100 × 4700
= 9 × 4700/100
= 42300/100 = 423
Thus, simple Interest for 1 year = $423
Now,
∵ If the simple Interest is $423, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/423 years
∴ If the simple Interest is $3807, then the time = 1/423 × 3807 years
= 1 × 3807/423 years
= 3807/423 = 9 years
Thus, time (T) = 9 years Answer
Similar Questions
(1) How much loan did Jason borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8470 to clear it?
(2) Calculate the amount due if Richard borrowed a sum of $3600 at 10% simple interest for 3 years.
(3) Find the amount to be paid if Jessica borrowed a sum of $5750 at 4% simple interest for 8 years.
(4) Karen took a loan of $5900 at the rate of 10% simple interest per annum. If he paid an amount of $11210 to clear the loan, then find the time period of the loan.
(5) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 9% simple interest?
(6) 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.
(7) Thomas had to pay $4256 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(8) Calculate the amount due if Linda borrowed a sum of $3350 at 6% simple interest for 4 years.
(9) Mary took a loan of $4100 at the rate of 6% simple interest per annum. If he paid an amount of $5822 to clear the loan, then find the time period of the loan.
(10) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 5% simple interest?