Question

Find compound interest on Rs.4000 for 6 months at 20% per annum compounded quarterly.

Answer 1

The compound interest (CI ) is "Rs. 410".

Step-by-step explanation:

Given,

Principle(P) = Rs.4000, Time(n) = 6 months = 2quaterly and

rate(r) = 20 % per annum = 5 % quaterly

Find compound interest (CI ) = ?

∴ Amount(A) = P$( 1 + \dfrac{r}{100} )^{n}$

A = Rs.4000 × $\dfrac{105}{100}$ × $\dfrac{105}{100}$

= Rs.4000 × $\dfrac{21}{20}$ × $\dfrac{21}{20}$

= Rs. 10 × 441

= Rs. 4410

∴ Compound interest (CI ) = Amount(A)  - Principle(P)

=  Rs. 4410 - Rs.4000,

= Rs. 410

Hence, the compound interest (CI ) is "Rs. 410".