Q1) Find the amount a d the compound interest on 5000 at 10% p.a. for 1
year, the interest being
compounded half yearly.
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Answer:
When compounded half-yearly, the rate is halved and the time is doubled.
Principal (P) = ₹5000
Rate (R) = (10÷2)% = 5%
Time (n) = (1×2) years = 2 years
Amount (A) = P (1 + R/100)ⁿ
=> A = 5000 (1 + 5/100)²
=> A = 5000 (21/20)²
=> A = ₹5512.50
Compound Interest = A-P = ₹5512.50 - ₹5000 = ₹512.50
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