Question:
Betty took a loan of $6500 at the rate of 7% simple interest per annum. If he paid an amount of $11050 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $6500
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $11050
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 = $11050 – $6500 = $4550
Thus, Simple Interest = $4550
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 × 4550/6500 × 7
= 455000/45500
= 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) = $6500
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $4550 (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 $6500
= 7/100 × 6500
= 7 × 6500/100
= 45500/100 = 455
Thus, simple Interest for 1 year = $455
Now,
∵ If the simple Interest is $455, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/455 years
∴ If the simple Interest is $4550, then the time = 1/455 × 4550 years
= 1 × 4550/455 years
= 4550/455 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) How much loan did Carol borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8460 to clear it?
(2) Calculate the amount due if Charles borrowed a sum of $3900 at 5% simple interest for 3 years.
(3) Find the amount to be paid if Barbara borrowed a sum of $5550 at 8% simple interest for 8 years.
(4) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 10% simple interest?
(5) Find the amount to be paid if Robert borrowed a sum of $5100 at 10% simple interest for 8 years.
(6) Find the amount to be paid if Michael borrowed a sum of $5300 at 2% simple interest for 8 years.
(7) How much loan did Robert borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6120 to clear it?
(8) Calculate the amount due after 9 years if David borrowed a sum of $5400 at a rate of 7% simple interest.
(9) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 6% simple interest?
(10) Linda took a loan of $4700 at the rate of 6% simple interest per annum. If he paid an amount of $6956 to clear the loan, then find the time period of the loan.