Question:
Linda took a loan of $4700 at the rate of 6% simple interest per annum. If he paid an amount of $7520 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $4700
Rate of Simple Interest (R) = 6% per annum
Amount (A) = $7520
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 = $7520 – $4700 = $2820
Thus, Simple Interest = $2820
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 × 2820/4700 × 6
= 282000/28200
= 10 years (using formula)
Thus, Time (T) = 10 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) = 6% per annum
Simple Interest = $2820 (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 = 6% of Principal
= 6% of $4700
= 6/100 × 4700
= 6 × 4700/100
= 28200/100 = 282
Thus, simple Interest for 1 year = $282
Now,
∵ If the simple Interest is $282, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/282 years
∴ If the simple Interest is $2820, then the time = 1/282 × 2820 years
= 1 × 2820/282 years
= 2820/282 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) How much loan did Betty borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7500 to clear it?
(2) What amount does Sarah have to pay after 6 years if he takes a loan of $3850 at 8% simple interest?
(3) Calculate the amount due if John borrowed a sum of $3200 at 3% simple interest for 4 years.
(4) Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $10640 to clear the loan, then find the time period of the loan.
(5) James had to pay $3360 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(6) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 10% simple interest?
(7) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 5% simple interest for 7 years.
(8) Mary had to pay $3416 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(9) How much loan did Jessica borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6900 to clear it?
(10) Calculate the amount due if Michael borrowed a sum of $3300 at 8% simple interest for 4 years.