Kiran invests rs 25000 for 3 years at 10 pa compounded annually. Charan invests rs 25000 for 1 and 1/2 years at 20% pa compounded half-yearly. Who will earn more interest?
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ANSWER
P = Rs. 25000, n = 3 years, r = 12% p.a
∴ Amount =P(1+
100
r
)
n
=Rs.25000×(1+
100
12
)
3
=Rs.25000×(
100
112
)
3
=Rs.25000×
25
28
×
25
28
×
25
28
=Rs.35123.20
∴ Compound interest =Rs.(35123.20−25000)=Rs.10123.20
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