Question:
Michael took a loan of $4600 at the rate of 7% simple interest per annum. If he paid an amount of $7820 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $4600
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $7820
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 = $7820 – $4600 = $3220
Thus, Simple Interest = $3220
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 × 3220/4600 × 7
= 322000/32200
= 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) = $4600
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $3220 (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 $4600
= 7/100 × 4600
= 7 × 4600/100
= 32200/100 = 322
Thus, simple Interest for 1 year = $322
Now,
∵ If the simple Interest is $322, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/322 years
∴ If the simple Interest is $3220, then the time = 1/322 × 3220 years
= 1 × 3220/322 years
= 3220/322 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) James took a loan of $4000 at the rate of 9% simple interest per annum. If he paid an amount of $6880 to clear the loan, then find the time period of the loan.
(2) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 6% simple interest?
(3) Daniel took a loan of $6200 at the rate of 9% simple interest per annum. If he paid an amount of $10106 to clear the loan, then find the time period of the loan.
(4) What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 10% simple interest?
(5) Calculate the amount due if Patricia borrowed a sum of $3150 at 5% simple interest for 3 years.
(6) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 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) What amount will be due after 2 years if Thomas borrowed a sum of $3400 at a 9% simple interest?
(9) What amount does Thomas have to pay after 5 years if he takes a loan of $3800 at 8% simple interest?
(10) Ashley had to pay $4959.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.