Question:
Mark took a loan of $6800 at the rate of 7% simple interest per annum. If he paid an amount of $11560 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $6800
Rate of Simple Interest (R) = 7% per annum
Amount (A) = $11560
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 = $11560 – $6800 = $4760
Thus, Simple Interest = $4760
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 × 4760/6800 × 7
= 476000/47600
= 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) = $6800
Rate of Simple Interest (R) = 7% per annum
Simple Interest = $4760 (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 $6800
= 7/100 × 6800
= 7 × 6800/100
= 47600/100 = 476
Thus, simple Interest for 1 year = $476
Now,
∵ If the simple Interest is $476, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/476 years
∴ If the simple Interest is $4760, then the time = 1/476 × 4760 years
= 1 × 4760/476 years
= 4760/476 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) Calculate the amount due after 10 years if David borrowed a sum of $5400 at a rate of 7% simple interest.
(2) How much loan did Brian borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $8280 to clear it?
(3) Calculate the amount due if Robert borrowed a sum of $3100 at 6% simple interest for 3 years.
(4) How much loan did Laura borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9812.5 to clear it?
(5) Daniel took a loan of $6200 at the rate of 10% simple interest per annum. If he paid an amount of $11160 to clear the loan, then find the time period of the loan.
(6) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $8100 to clear the loan, then find the time period of the loan.
(7) Find the amount to be paid if Charles borrowed a sum of $5900 at 6% simple interest for 7 years.
(8) How much loan did Mary borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5555 to clear it?
(9) Steven had to pay $5152 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(10) Calculate the amount due if Richard borrowed a sum of $3600 at 2% simple interest for 4 years.