Question

Calculate compound interest for Rs $20,000$ for $1$ year at $16$% compounded semi-annually.

• A. Rs.$3172$
  
• B. Rs.$3328$
• C. Rs.$3611$
• D. Rs.$3752$

Answer 1

The correct option is B Rs.$3328$

Principal=Rs.20,000

Time =1 year compounded semi-annually

Rate=16%

As the interest is compounded semi-annually so the rate is divided by 2 and the time is multiply by 2

$\therefore A=P{(1+\frac{R}{2\times 100})}^{T\times 2}$

$\Rightarrow A=20,000(1+\frac{8}{100}{)}^2$

$\Rightarrow A=20,000\times \frac{108}{100}\times \frac{108}{100}$

$\Rightarrow A=2\times 108\times 108$

$\Rightarrow A=Rs.23328$

$\therefore C.I=23328-20000=Rs.3328$