Question

Find compound interest on Rs 2500 invested at 6% annually, compounded semi annually for 2 years

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Answer 1

Present value=₹2500

Interest rate=10% per annum

Time=2 years

To find the amount we have the formula,

Amount(A)=P(1+(R/100))

n

where P is present value, r is rate of interest, n is time in years.

Now substituting the values in above formula we get,

∴A=2500(1+10/100)

2

⇒A=2500(11/10)

2

⇒A=2500(121/100)

⇒A=25(121)

⇒A=₹3025

Now,

∴ Compound interest = A–P

=3025–2500=₹525

Hope it will help you a lot