Question:
Betty took a loan of $6500 at the rate of 9% simple interest per annum. If he paid an amount of $11765 to clear the loan, then find the time period of the loan.
Correct Answer
9
Solution And Explanation
Solution
Given,
Principal (P) = $6500
Rate of Simple Interest (R) = 9% per annum
Amount (A) = $11765
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 = $11765 – $6500 = $5265
Thus, Simple Interest = $5265
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 × 5265/6500 × 9
= 526500/58500
= 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) = $6500
Rate of Simple Interest (R) = 9% per annum
Simple Interest = $5265 (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 $6500
= 9/100 × 6500
= 9 × 6500/100
= 58500/100 = 585
Thus, simple Interest for 1 year = $585
Now,
∵ If the simple Interest is $585, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/585 years
∴ If the simple Interest is $5265, then the time = 1/585 × 5265 years
= 1 × 5265/585 years
= 5265/585 = 9 years
Thus, time (T) = 9 years Answer
Similar Questions
(1) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 7% simple interest?
(2) Calculate the amount due if Charles borrowed a sum of $3900 at 2% simple interest for 4 years.
(3) Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $9983 to clear the loan, then find the time period of the loan.
(4) Lisa took a loan of $6100 at the rate of 9% simple interest per annum. If he paid an amount of $9943 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due if Michael borrowed a sum of $3300 at 3% simple interest for 3 years.
(6) Find the amount to be paid if Richard borrowed a sum of $5600 at 2% simple interest for 7 years.
(7) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 5% simple interest for 4 years.
(8) If David borrowed $3400 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(9) If Steven paid $4968 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(10) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 8% simple interest?