Question

a man deposited rupees 50000 in in bank for 2 years At 10% compound interest annually. but one year after Bank changed the policy and decided to pay semi-annual compound interest at the same rate. What is the percentage difference between compound interest of first and second year? give reason with calculation.​

Answer 1

ANSWER:---------------

Principal,P` = Rs 55,000

Rate of Interest,R`= 102\dfrac{10} {2}

2 -10= 5%

Time,t` = 2×2\times2× 1= 2 years.

So,

Principle Amount Will be =>

A` =P‘(1+R100)t‘P`(1 + \dfrac{R}{100})^{t`}P‘(1+

100R) t‘

=> A`= 55,000(1+5100)255,000(1 + \dfrac{5} {100})^{2}55,000(1+

100. 5) 2

=> A`= 55,000(105100)255,000(\dfrac{105} {100})^255,000(

100---(105) 2

=>A` = Rs 60,637.5.

Hence the the compound interest in second case is

Rs (60,637.5 - 50,000)=Rs 5,647.5

So the change in Compound interest in second case

=Rs(5,647.5 - 5000)

=Rs 647.5

So the percentage of change in Compound interest in first and second years Will be =>

Change% = increaseininterestOriginalInterest×100%\dfrac{increase in interest}{Original Interest} \times 100\%

OriginalInterest

increaseininterest

×100%

=> Change% = 647.55000×100%\dfrac{647.5} {5000}\times 100\%

5000

647.5

×100%

=>Change% = 12.95%12.95 \%12.95%

Remember

A=P(1+R100)tA = P(1 + \dfrac{R}{100})^{t}A=P(1+

hope it helps:--

T!—;ANKS!!!