What would be the compound interest on Rs 15,750 at 20% per annum, in two years, if the interest is compounded half yearly?
Answer & explanation
Correct answer: option 4
Principal = Rs 15750
Rate = 20% p.a
Time = 2 years
Interest is Compounded half yearly , so Rate become half and time become double
so Rate = \(\frac{20}{2}\)
= 10%
time = 2 × 2 = 4 years
10% 10 : 11
10 : 11
10 : 11
10 : 11
10000 : 14641
Compound Interest = Amount - Principal
= 14641-10000
= Rs 4641
ATQ
10000= 15750
1=\(\frac{15750}{10000}\)
4641= \(\frac{15750}{10000}\) × 4641
= Rs 7309.575