Question

Find the difference between the compound interest on rs. 160000 for 1 year at 20% per annum when compounded half yearly and quarterly

Answer 1

Answer:

The difference between the compound interest is Rs.881.

Step-by-step explanation:

Given : The compound interest on rs. 160000 for 1 year at 20% per annum when compounded half yearly and quarterly.

To find : The difference between the compound interest?

Solution :

Compound interest formula is $C.I=A+P$

Where, $A=P(1+r)^t$

Here, P is the principal, r is the rate of interest , t is the time and A is the amount.

1) When Rs. 160000 for 1 year at 20% per annum compounded half yearly.

P=Rs.160000

$r=\frac{20}{100\times 2}=0.1$

$t=1\times 2=2$

Substitute in the formula,

$A=160000(1+0.1)^2$

$A=160000(1.1)^2$

$A=160000\times 1.21$

$A=193600$

Compound interest is $C.I=193600+160000$

Compound interest compounded half yearly is Rs. 353600.

2) When Rs. 160000 for 1 year at 20% per annum compounded quarterly.

P=Rs.160000

$r=\frac{20}{100\times 4}=0.05$

$t=1\times 4=4$

Substitute in the formula,

$A=160000(1+0.05)^4$

$A=160000(1.05)^4$

$A=160000\times 1.21550625$

$A=194481$

Compound interest is $C.I=194481+160000$

Compound interest compounded quarterly is Rs. 354481.

Now, We find the difference between them,

$D=354481-353600$

$D=881$

Therefore, The difference between the compound interest is Rs.881.

Answer 2

Answer:881

Step-by-step explanation:

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