7. Vijay lent 20,500 for 2 years at 25% per annum compounded annually. How much more
could he earn if the interest is compounded half yearly?
Shruti horrowd 10
Answers
Answered by
0
Step-by-step explanation:
Amount of loan,
P
=
65536
Rate of interest
(
R
)
=
12
1
2
%
=
25
2
%
per annum or
25
4
%
half yearly
Period
(
n
)
=
2
years or
4
half years
When the interest is compounded half yearly, then
∴
Amount
(
A
)
=
P
(
1
+
R
100
)
n
=
R
s
.
65536
(
1
+
25
4
×
100
)
4
=
R
s
.
65536
×
(
17
16
)
4
=
R
s
.
65536
×
17
16
×
17
16
×
17
16
×
17
16
=
R
s
.
83521
If the interest in compounded annually, then
Amount
=
R
s
.
65536
(
1
+
25
2
×
100
)
2
=
R
s
.
65536
×
(
9
8
)
2
=
R
s
.
65536
×
9
8
×
9
8
=
R
s
.
82944
∴
More interest received
=
R
s
.
83521
−
82944
=
R
s
.577
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