16000 for 25/2 years at 10% pa, the interest being compounded half-yearly.
Answers
I=P[(1+R%n)nt−1]
Data:P- Principal, R%- Rate of Interest-10%, n-frequency of compounding in a year-2, t- numberof years-1.5 years.
I=16000[(1+10%2)2×1.5−1]
I=16000[(1.05)3−1]
I=16000[1.1576−1]
I=16000×0.1576
I=2522
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What will the compound interest be on ₹ 20,000 for 1 and a half years at 10 per cent age per annum compounded annually?
What will be the compound interest on an amount of ₹ 120 00, if the interest is compounded half-yearly at 20% per annum for 1 1/2 years?
What is the compound interest (in Rs.) for 1 year on a sum of Rs. 20,000 at the rate of 40% per annum compounded half yearly?
It is calculated as under -
Interest rate per annum - 10%
No of rests per annum - 1 for annual, 2 for half year, 4 for Quarterly and 12 for monthly
Effective interest per rest - Per annum Interest rate divide by no of rest per annum - 10/2 = 5%
Rest Period in known time - 1–1/2 years / 6 months = 3
Interest = Principal x (1+Effective interest rate) raised to power 3 - Principal Amount
Or
16000 x 1.05 x 1,05 x 1,05 - 16000 = 2522/-
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this is the line method in which i have made 3 cycles each of 5% so find 5% of 16000 then similarly for all read the lines that i have written if u don’t understand what i do comment ur query in comment section if you like then follow me and share
The compounding is happening 1/2 yly, hence effective compounding term is 3 for 1 and 1/2 year duration, in the compounding equation. Principal amount is 16000. Interest rate for 1/2 yly compounding is 5% (10%/2).
Hence Compound Interest = P*(1+r/100)^n - P = 16000*(1.05)^3 - 16000 = 18522–16000 = 2522
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