Question:
Richard took a loan of $5200 at the rate of 7% simple interest per annum. If he paid an amount of $8840 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $5200
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $8840
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 = $8840 – $5200 = $3640
Thus, Simple Interest = $3640
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 × 3640/5200 × 7
= 364000/36400
= 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) = $5200
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $3640 (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 $5200
= 7/100 × 5200
= 7 × 5200/100
= 36400/100 = 364
Thus, simple Interest for 1 year = $364
Now,
∵ If the simple Interest is $364, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/364 years
∴ If the simple Interest is $3640, then the time = 1/364 × 3640 years
= 1 × 3640/364 years
= 3640/364 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) Sarah took a loan of $5700 at the rate of 9% simple interest per annum. If he paid an amount of $9804 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 9 years if Elizabeth borrowed a sum of $5450 at a rate of 9% simple interest.
(3) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 2% simple interest?
(4) What amount does John have to pay after 6 years if he takes a loan of $3200 at 10% simple interest?
(5) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 8% simple interest?
(6) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 7% simple interest?
(7) Find the amount to be paid if William borrowed a sum of $5500 at 4% simple interest for 7 years.
(8) What amount does Barbara have to pay after 6 years if he takes a loan of $3550 at 10% simple interest?
(9) If Steven paid $5152 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(10) How much loan did Ryan borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9875 to clear it?