Question

If interest is compounded half yearly then find the compound interest for 11/2year on Rs1,500/-at10% annual rate of interest.

Answer 1

Answer:

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Where, P = Principal  

R = Rate of interest p.a (per annum i.e annually)

n = number of years.  

Examples :  

1) Find the compound interest on $320,000 for one year at the rate of 20% p.a., if the interest rate is compounded quarterly.

Step-by-step explanation:

Here, P = $320,000, R = 20% p.a. and n = 1 year.

∴ Amount after 1 year = P ( 1 + R/4 ) 4n  

= 320,000 x ( 1 + 0.20/4 ) 4 x 1  

= 320,000 x ( 1 + 0.05) 4  

= 320,000 x (1.05 ) 4  

= 320,000 x 1.21550  

= Rs. 388,962  

∴ Compound interest = 388,962 – 320,000 = 68,962