Question

Find the amount and the compound interest on 10,000 for 1 1/2 years at 10% per annum, compounded half yearly. Would this interest be more than the interest he would get if it was compounded annually? Please give step to step explanation

Answer 1

Answer:

If interest is compounded half yearly, rate of interest = R / 2 and A = P [ 1 + ( {R / 2} / 100 ) ]T, where 'T' is the time period. For example, if we have to calculate the interest for 1 year, then T = 2. For 2 years, T = 4

Answer 2

Step-by-step explanation:

Compounded half yearly:

A=P(1+

200

r

)

2n

×(1+

100

br

)

=10000(1+

200

10

)

(2)

×

⎝

⎜

⎜

⎛

1+

100

2

1

×10

⎠

⎟

⎟

⎞

=10000(1.1025)(1.05)

=11576.25

Amount =Rs.11,576.25

CI=A−P=Rs.1576.25

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