Question

A sum of ₹12,000 is invested for 1.5 years which will be compounded half yearly at a rate of 10%. Find the amount obtained.

• A. ₹13,890
• B. ₹13,891.50
• C. ₹13,591
• D. ₹14,891.50

Answer 1

The correct option is B ₹13,891.50

Time is calculated half yearly.

There are 3 half years in 1.5 years.

So, $n=3$

Also, the rate given is per annum. Therefore, for the half yearly rate, we divide it by 2.

$\therefore$ Half-yearly compound interest is $\frac{R}{2}$.

$A=P\times {[1+\frac{R}{2\times 100}]}^n$
$A=₹12,000\times {[1+\frac{10}{2\times 100}]}^3$
$A=₹12,000\times {[1+\frac{1}{20}]}^3$
$A=₹12,000\times {\left[\frac{21}{20}\right]}^3$
$A=₹13891.5$