What is the difference (in Rs.) between the interest on Rs. 40,000 for one year at 12% per annum compounded half yearly  and yearly?

144

Amount = 40,000

Interest = 12%

If we calculate yearly

Total interest = 12%

If we calculate half yearly

Total interest = 6% + 6% + \(\frac{6 × 6}{100}\)%

                   = 12.36%

Difference in interest = 12.36% - 12% = 0.36%

Difference in interest = 40000 × 0.36%

                                  = 40000 × \(\frac{0.36}{100}\)

                                  = 40000 × \(\frac{36}{10000}\)

                                   = Rs.144