Question

Vikas borrowed Rs 25000 from his friend at 20% per annum compounded half yearly. Find the amount of money,which will discharge his debt after 1 whole 1/2 years


Answer is 33275

I want step by step explaination ​

Answer 1

A=P(1+r)^t

Here,
A= Final Amount
P= Principal
r= Rate of interest
t= Time (years)

Given that amount is compounded half yearly,
1.5 years would include 3 cycles.
t=3
P=25000
r= 20%/2 =0.1 (∵r=20%p.a. so r = 10% half yearly)

∴A=25000(1.1)^3 = Rs. 33275

Answer 2

p=25000

r=20%

n = 1 ½ years

compounded half yearly , so

r=20% p.a = 20% /2 =10% half yearly

n = 1 ½years = 3 half years

A = 25000(1+ 10%)³

= 25000 × 1.1³ = 33275/-