Question

Rashi invests ₹ 10000 at 10% pa for 1 1⁄2 yrs compounded annually and Reema invests
the same sum at the same rate for the same time period but compounded half-yearly.
Who will earn more amount and by how much?

Answer 1

Given info : Rashi invests ₹ 10000 at 10% pa for 1 1⁄2 yrs compounded annually and Reema invests

the same sum at the same rate for the same time period but compounded half-yearly .

To find : who will earn more amount and by how much ?

solution : For Rashi,

P = 10,000 Rs.

r = 10% per annum

n = 1 1/2 years = 3/2

so C.I = compound interest of 1 year + SI of 1/2 years

= [10000(1 + 10/100)¹ - 10000] + 10000 × 1/2 × 10/100

= 1000 + 500

= 1500 Rs.

for Reema,

P = 10000

r = 10% per annum = 5 % per half - yearly

time , n = 1 1/2 years = 3 half years

so, A = P(1 + r/100)ⁿ

= 10000(1 + 5/100)³

= 10000(21/20)³

= 11576.25 Rs.

C.I = 11576.25 - 10000 = 1576.25 Rs.

you can see Reema will earn more amount and she gets 76.25 Rs much than Rashi.