What is the compound interest on ₹80,000 for 1 year at 10 per cent per annum, compounded half yearly?

₹8,200

Interest is compounded half - yearly .

Actual interest = \(\frac{10}{2}\)% = 5%

From the formula for compound interest, we know,

C.I = P(1+$\frac{R}{100})^t$– P

 = 80000 [ 1 + \(\frac{5}{100}\) ]² - 80000

 = 80000 [ \(\frac{21}{20}\) × \(\frac{21}{20}\)  - 1 ]

 = 80000 [ \(\frac{41}{400}\) ]

= Rs. 8200