Question:
Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $10400 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $6500
Rate of Simple Interest (R) = 6% per annum
Amount (A) = $10400
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 = $10400 – $6500 = $3900
Thus, Simple Interest = $3900
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 × 3900/6500 × 6
= 390000/39000
= 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) = $6500
Rate of Simple Interest (R) = 6% per annum
Simple Interest = $3900 (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 $6500
= 6/100 × 6500
= 6 × 6500/100
= 39000/100 = 390
Thus, simple Interest for 1 year = $390
Now,
∵ If the simple Interest is $390, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/390 years
∴ If the simple Interest is $3900, then the time = 1/390 × 3900 years
= 1 × 3900/390 years
= 3900/390 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) How much loan did Edward borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9120 to clear it?
(2) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 5% simple interest?
(3) How much loan did John borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $5980 to clear it?
(4) How much loan did Donna borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7877.5 to clear it?
(5) How much loan did Jennifer borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6300 to clear it?
(6) Karen took a loan of $5900 at the rate of 7% simple interest per annum. If he paid an amount of $8791 to clear the loan, then find the time period of the loan.
(7) Calculate the amount due if John borrowed a sum of $3200 at 8% simple interest for 4 years.
(8) How much loan did Thomas borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7250 to clear it?
(9) In how much time a principal of $3050 will amount to $3507.5 at a simple interest of 3% per annum?
(10) Richard took a loan of $5200 at the rate of 8% simple interest per annum. If he paid an amount of $8944 to clear the loan, then find the time period of the loan.