Arif took a loan of 80000 from a bank if the rate of interest is 10% per annum find the difference in amounts he would be paying after 1 1/2 if the interest is compounded annually and compounded half yearly
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Compounded Annually :
P=Rs.80000
R=10% p.a.
T=121 years ⟹n=1+21
Amount for 1st year.
A=P[1+100R]n
=Rs.80000[1+10010]=Rs.88000
SI on Rs. 88000 for next 1/2 year
=Rs.88000×10010×21=Rs.4400
Therefore, Amount = Rs.88000+Rs.4400 = 92400Rs.
Compounded half yearly :
P=Rs.80000
R=10% p.a.=5% per half year
T=121 years ⟹n=3
A=Rs.80000[1+1005]3
A=Rs.92610
Thus, the difference between the two amounts = Rs.92610−Rs.92400 =Rs.210
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