Find the compound interest on ₹42000 for $1\frac{1}{2}$ years at 10% p.a. compounded annually.
Answer & explanation
Correct answer: option 3
Principal = 42000
Rate = 10% p.a. compounding annually
Time = 1.5 years
Amount for 1 year = P(1 + r/100)^T = 42000 (1 + 10/100)^1 = 42000 (1.1) = 46200
simple interest interest for half year = 46200*0.5*10/100 = 2310
Total Interest = 4200+2310 = 6510
The correct answer is Option (3) → ₹6510