Question:
Joseph took a loan of $5400 at the rate of 10% simple interest per annum. If he paid an amount of $10800 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) = 10% per annum
Amount (A) = $10800
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 = $10800 – $5400 = $5400
Thus, Simple Interest = $5400
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 × 5400/5400 × 10
= 540000/54000
= 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) = 10% per annum
Simple Interest = $5400 (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 = 10% of Principal
= 10% of $5400
= 10/100 × 5400
= 10 × 5400/100
= 54000/100 = 540
Thus, simple Interest for 1 year = $540
Now,
∵ If the simple Interest is $540, then the time = 1 year
∴ If the simple Interest is $1, then the time = 1/540 years
∴ If the simple Interest is $5400, then the time = 1/540 × 5400 years
= 1 × 5400/540 years
= 5400/540 = 10 years
Thus, time (T) = 10 years Answer
Similar Questions
(1) Find the amount to be paid if Sarah borrowed a sum of $5850 at 5% simple interest for 8 years.
(2) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 10% simple interest?
(3) Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $10080 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due if William borrowed a sum of $3500 at 9% simple interest for 3 years.
(5) If Barbara paid $4260 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(6) Mary took a loan of $4100 at the rate of 7% simple interest per annum. If he paid an amount of $6970 to clear the loan, then find the time period of the loan.
(7) Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $10640 to clear the loan, then find the time period of the loan.
(8) How much loan did Joseph borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7125 to clear it?
(9) How much loan did Paul borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8040 to clear it?
(10) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $9180 to clear the loan, then find the time period of the loan.