Question

solve carefully and totally

Answer 1

Given P = 12800, T=2, R = 7 1/2% = 15/2% Semi-annually = 15/4%.

We know that A = P(1+r/100)^n

                            = 12800(1+(15/4)/100)^2

                            = 12800(415/400)^2

                            = 12800 * 415/400 * 415/400

                            = 13778.


We know that CI = A - P

                            = 13778 - 12800

                            = 978.


Hope this helps!