Question:
Margaret took a loan of $6700 at the rate of 7% simple interest per annum. If he paid an amount of $11390 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $6700
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $11390
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 = $11390 – $6700 = $4690
Thus, Simple Interest = $4690
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 × 4690/6700 × 7
= 469000/46900
= 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) = $6700
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $4690 (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 $6700
= 7/100 × 6700
= 7 × 6700/100
= 46900/100 = 469
Thus, simple Interest for 1 year = $469
Now,
∵ If the simple Interest is $469, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/469 years
∴ If the simple Interest is $4690, then the time = 1/469 × 4690 years
= 1 × 4690/469 years
= 4690/469 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) If Jennifer paid $3770 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(2) How much loan did Sharon borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8525 to clear it?
(3) Calculate the amount due after 10 years if Elizabeth borrowed a sum of $5450 at a rate of 2% simple interest.
(4) Mark had to pay $4928 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(5) 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.
(6) Robert had to pay $3472 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(7) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 8% simple interest.
(8) Barbara took a loan of $5100 at the rate of 6% simple interest per annum. If he paid an amount of $7242 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if Joseph borrowed a sum of $5700 at 8% simple interest for 7 years.
(10) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $8624 to clear the loan, then find the time period of the loan.