What amount is to be repaid on a loan of Rs 12000 for Two and a half years at 10% per annum compounded half yearly.
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As interest is compounded half yearly, so 1 number of conversion periods in 15 years 2
is 3, So n = 3
rate for half year 1 2 × 10% = 5%
A = P (1+80) R n
A = 12000 | 1+ 5 100 3
: 12000 = 105 100 3
= Rs.13891.50
Compound interest = A - P
= 13891.50 - 12000
= Rs.1891.50
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