Question:
Mark took a loan of $6800 at the rate of 10% simple interest per annum. If he paid an amount of $12920 to clear the loan, then find the time period of the loan.
Correct Answer
9
Solution And Explanation
Solution
Given,
Principal (P) = $6800
Rate of Simple Interest (R) = 10% per annum
Amount (A) = $12920
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 = $12920 – $6800 = $6120
Thus, Simple Interest = $6120
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 × 6120/6800 × 10
= 612000/68000
= 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) = $6800
Rate of Simple Interest (R) = 10% per annum
Simple Interest = $6120 (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 = 10% of Principal
= 10% of $6800
= 10/100 × 6800
= 10 × 6800/100
= 68000/100 = 680
Thus, simple Interest for 1 year = $680
Now,
∵ If the simple Interest is $680, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/680 years
∴ If the simple Interest is $6120, then the time = 1/680 × 6120 years
= 1 × 6120/680 years
= 6120/680 = 9 years
Thus, time (T) = 9 years Answer
Similar Questions
(1) If Sarah paid $4466 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(2) Calculate the amount due after 9 years if Joseph borrowed a sum of $5700 at a rate of 9% simple interest.
(3) Patricia had to pay $3433.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(4) What amount does Jessica have to pay after 5 years if he takes a loan of $3750 at 4% simple interest?
(5) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 5% simple interest.
(6) If Joseph paid $3996 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(7) How much loan did Elizabeth borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6267.5 to clear it?
(8) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 10% simple interest?
(9) In how much time a principal of $3200 will amount to $3392 at a simple interest of 3% per annum?
(10) Calculate the amount due if Robert borrowed a sum of $3100 at 6% simple interest for 4 years.