The compounded interest on a sum of Rs. 20,000 at 20% p.a. for 2 years 3 months. When the interest is compounded 9 mothly, is?
Answer & explanation
Correct answer: option 2
Interest rate when compounded 9 monthly
= \(\frac{9}{12}\) × 20% = 15%
2 year 3 months = 27 months (creates 3 cycle)
Compound interest for 3 cycle of 9 months at the rate of 15%
15% → \(\frac{3}{20}\)
20 23
20 23
20 23
--------- --------
8000 12167
Principal Amount
↓ ↓
⇒ 4167 ⇐
C.I. = \(\frac{4167}{8000}\) × 20000 = 10417.5