Question

Find the compounded interest on 100000 at 20%p.a for 1 year if the interest is compounded after every four months.
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Answer 1

Answer:

Given, P=100000, r=0.2, n=2+

4

1

(converting 2 years 3 months to years) =n=2.25

Interest is compounded anually,

For first year =100000×0.2×1=20000

For second year P

new

=120000

Interest =120000×0.2×1=24000

For last 0.02544 year, p

new

=144000

Interest =144000×0.2×0.25=7200

New amount =144000+7200=151200

Interest=151200+100000=51200

Answer 2

Solution :-

Here, we have to find CI but the interest in compounded after every four months.

Therefore,

Principal = 100000

Rate of Interest = 20%

Time = 12/4 = 3

As we know that,

A = P ( 1 + R / 100 )^n

A = 100000 ( 1 + 20/100 )^3

A = 100000 ( 100 + 20/100)^3

A = 100000 ( 120/ 100 )^3

A = 100000*120/100*120/100*120/100

A = 10 * 120 * 120 * 120/100

A = 1 * 12 * 120 * 120

A = 12 * 120 * 120

A = 1440 * 120

A = 172800

Now, We have to find CI

CI = Amount - Principal

CI = 172800 - 100000

CI = 72800

Hence, Compound Interest is 72,800$.$