If the rate of compound interest is 20% per annum, compounded half-yearly, then what will be the interest on a principal of ₹100000 for two years?

₹46,410

Interest is compounded half yearly,

New rate = \(\frac{20}{2}\) % = 10%

From the formula for compound interest, we know,

C.I = P(1+$\frac{R}{100})^t$– P

 = 100000 [ \(\frac{11}{10}\) × \(\frac{11}{10}\) × \(\frac{11}{10}\) × \(\frac{11}{10}\) - 1 ]

 = 100000[ \(\frac{14641}{10000}\)  - 1 ]

= 100000 [ \(\frac{4641}{10000}\) ]

= Rs. 46410