Question:
Joseph took a loan of $5400 at the rate of 7% simple interest per annum. If he paid an amount of $9180 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $5400
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $9180
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 = $9180 – $5400 = $3780
Thus, Simple Interest = $3780
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 × 3780/5400 × 7
= 378000/37800
= 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) = $5400
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $3780 (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 $5400
= 7/100 × 5400
= 7 × 5400/100
= 37800/100 = 378
Thus, simple Interest for 1 year = $378
Now,
∵ If the simple Interest is $378, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/378 years
∴ If the simple Interest is $3780, then the time = 1/378 × 3780 years
= 1 × 3780/378 years
= 3780/378 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) If Michael borrowed $3300 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(2) Calculate the amount due if Michael borrowed a sum of $3300 at 5% simple interest for 4 years.
(3) Lisa took a loan of $6100 at the rate of 10% simple interest per annum. If he paid an amount of $10370 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 6% simple interest.
(5) Lisa took a loan of $6100 at the rate of 7% simple interest per annum. If he paid an amount of $8662 to clear the loan, then find the time period of the loan.
(6) Elizabeth took a loan of $4900 at the rate of 10% simple interest per annum. If he paid an amount of $9800 to clear the loan, then find the time period of the loan.
(7) Nancy had to pay $4523.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(8) What amount will be due after 2 years if William borrowed a sum of $3250 at a 6% simple interest?
(9) Karen took a loan of $5900 at the rate of 8% simple interest per annum. If he paid an amount of $8732 to clear the loan, then find the time period of the loan.
(10) Charles took a loan of $5800 at the rate of 8% simple interest per annum. If he paid an amount of $9048 to clear the loan, then find the time period of the loan.