Question:
Elizabeth took a loan of $4900 at the rate of 8% simple interest per annum. If he paid an amount of $8820 to clear the loan, then find the time period of the loan.
Correct Answer
10
Solution And Explanation
Solution
Given,
Principal (P) = $4900
Rate of Simple Interest (R) = 8% per annum
Amount (A) = $8820
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 = $8820 – $4900 = $3920
Thus, Simple Interest = $3920
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 × 3920/4900 × 8
= 392000/39200
= 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) = $4900
Rate of Simple Interest (R) = 8% per annum
Simple Interest = $3920 (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 = 8% of Principal
= 8% of $4900
= 8/100 × 4900
= 8 × 4900/100
= 39200/100 = 392
Thus, simple Interest for 1 year = $392
Now,
∵ If the simple Interest is $392, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/392 years
∴ If the simple Interest is $3920, then the time = 1/392 × 3920 years
= 1 × 3920/392 years
= 3920/392 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
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(2) Find the amount to be paid if Linda borrowed a sum of $5350 at 8% simple interest for 8 years.
(3) Barbara took a loan of $5100 at the rate of 7% simple interest per annum. If he paid an amount of $7599 to clear the loan, then find the time period of the loan.
(4) Linda took a loan of $4700 at the rate of 9% simple interest per annum. If he paid an amount of $8930 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 7% simple interest.
(6) Calculate the amount due if Patricia borrowed a sum of $3150 at 5% simple interest for 3 years.
(7) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 8% simple interest?
(8) If Michael borrowed $3300 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(9) Calculate the amount due if John borrowed a sum of $3200 at 3% simple interest for 3 years.
(10) Elizabeth took a loan of $4900 at the rate of 6% simple interest per annum. If he paid an amount of $7546 to clear the loan, then find the time period of the loan.