Question

Find the difference between compound interest on rs 4000 at the rate of 8% per annum compounded half yearly and the compound interest at 8% per annum compounded annually for two years

Answer 1

Compound interest when compounded half yearly:
        interest rate for 6 months = 8/2 = r = 4%
        number of times compounded = n= 4 in 2 years
        C I = P (1+ r/100)^n - 4000  = 4, 000 (1 + 0.04 )^4 - 4000
 
Compound interest when compounded yearly
        interest rate for 12 months = r = 8%
        number of times compounded = n= 2 in 2 years
        C I = P (1+ r/100)^n - 4000  = 4, 000 (1 + 0.08 )^2 - 4000
 
 Difference = Rs 4,000 [ 1.04^4  - 1.08^2 ]
                = Rs 4, 000 * 0.00345856 = Rs 13.83 

Answer 2

Answer:

Step-by-step explanation:

For 1st year

P = Rs. 4000

R = 8

T = 1 year

 

Selina Solutions Icse Class 9 Mathematics Chapter - Compound Interest Without Using Formula

 

A = 4000 + 320 = Rs. 4320

For 2nd year

P = Rs. 4320

R=8%

T = 1 year

 

Selina Solutions Icse Class 9 Mathematics Chapter - Compound Interest Without Using Formula

 

A = 4320 + 345.60 = 4665.60

Compound interest = Rs. 4665.60 - Rs. 4000

= Rs. 665.60

 

Simple interest for 2 years = Selina Solutions Icse Class 9 Mathematics Chapter - Compound Interest Without Using Formula

 

= Rs. 640

Difference of CI and SI = 665.60 - 640

= Rs 25.60