What is the compound interest on ₹5000 in 2 years at the rate of 20% per annum? (interest compounded half yearly)

₹2320.50

Interest is compounded half yearly

So, Actual rate of interest = \(\frac{20}{2}\)% = 10%

From the formula for compound interest, we know,

C.I = P(1+$\frac{R}{100})^t$– P

= 1000[ \(\frac{11}{10}\) × \(\frac{11}{10}\)× \(\frac{11}{10}\)× \(\frac{11}{10}\) - 1 ]

= 5000[ \(\frac{14641}{10000}\)  - 1 ] 

= 5000[ \(\frac{4641}{10000}\)  ]

= Rs. 2320.50