Question

Suresh borrowed Rs 10000 for 12 years at 10% per annum, compounded half yearly. Had he borrowed Rs 10000 for 1 years at 10% per annum, Compounded annually,then find the amount and compound interest in both the cases.​

Answer 1

Ans -

Principal(P) = 10,000

Period (T)= 1 year

Sum amount (A)= 11200

Rate of interest =?

(i) We know that

Interest (I)= 11200- 10000= 1200

So the rate of interest

R= (1×100)/(P×T)

Substituting the values

R= (1200×100)/(1000×1)

So we get

R= 12% p.a

Therefore, the rate of interest per annum is 12% p.a

(ii) We know that

Period (T)= 2 years

Rate of interest (R) = 12% p.a.

Here

A =P(1+R/100)

1

Substituting the values

A = 10000(1+12/100)

2

By further calculation

A= 10000(28/25)

2

We can write it as

A= 10000×28/25×28/25

So we get

A=16×28×28

A=12544

Therefore, the amount at the end of the second year is 12544.