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) Karen took a loan of $5900 at the rate of 6% simple interest per annum. If he paid an amount of $8024 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 4% simple interest.
(3) Calculate the amount due if Thomas borrowed a sum of $3800 at 3% simple interest for 4 years.
(4) Anthony took a loan of $6600 at the rate of 9% simple interest per annum. If he paid an amount of $11946 to clear the loan, then find the time period of the loan.
(5) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $8400 to clear the loan, then find the time period of the loan.
(6) How much loan did Jessica borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6325 to clear it?
(7) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 4% simple interest?
(8) Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $10010 to clear the loan, then find the time period of the loan.
(9) If Christopher borrowed $4000 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(10) In how much time a principal of $3100 will amount to $3224 at a simple interest of 2% per annum?