Question:
Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $7650 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $4500
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $7650
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 = $7650 – $4500 = $3150
Thus, Simple Interest = $3150
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 × 3150/4500 × 7
= 315000/31500
= 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) = $4500
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $3150 (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 = 7% of Principal
= 7% of $4500
= 7/100 × 4500
= 7 × 4500/100
= 31500/100 = 315
Thus, simple Interest for 1 year = $315
Now,
∵ If the simple Interest is $315, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/315 years
∴ If the simple Interest is $3150, then the time = 1/315 × 3150 years
= 1 × 3150/315 years
= 3150/315 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) Linda had to pay $3651.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(2) 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.
(3) Find the amount to be paid if David borrowed a sum of $5400 at 8% simple interest for 7 years.
(4) In how much time a principal of $3150 will amount to $3433.5 at a simple interest of 3% per annum?
(5) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $7040 to clear the loan, then find the time period of the loan.
(6) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 4% simple interest?
(7) Joseph took a loan of $5400 at the rate of 6% simple interest per annum. If he paid an amount of $7668 to clear the loan, then find the time period of the loan.
(8) Donald took a loan of $7000 at the rate of 6% simple interest per annum. If he paid an amount of $10360 to clear the loan, then find the time period of the loan.
(9) Mary had to pay $3324.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(10) What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 4% simple interest?