Question

Find the compound interest - Principle= Rs 50000 Rate=12% Time=9/4 years


Answer is

Amount= Rs 64601.60
Compound interest= Rs 14601.60


I want step by step explaination fast ​

Answer 1

Answer:

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Step-by-step explanation:

Lets calculate the two and see what the difference is, using the formula of future value i.e. P x (1+r)^n, where P is principal amount, r is interest rate and n is period

Annual payment

FV = 50000 x (1.12)^1 = 56,000

Half yearly payment

FV = 50000 x (1.06)^2 = 56,180

So, the compounded interest is higher in case of half yearly payments by Rs. 180.

This is logical because in this case we have received interest during the year and therefore there is an additional amount on which interest has been applied as at year end (i.e. we received Rs. 3000 at half year, so additional interest would be the interest on this amount i.e. 3000 x 6% = Rs. 180)