Question

Calculate compound interest on Rs. $62500$ for $1\frac{1}{2}$ years at $8\%$ per annum compounded half-yearly.

Answer 1

Given, Principal (P) = Rs. $62,500$

Rate $=8$ % per annum or $4$ % per half year

Number of years = $1\frac{1}{2}$

There will be $3$ half years in $1\frac{1}{2}$ years.

We know,

$A=P[1+\frac{R}{100}{]}^n$

$\Rightarrow A=62500[1+(\frac{4}{100}{)}^3]$

$\Rightarrow A=62500\times \frac{26}{25}\times \frac{26}{25}\times \frac{26}{25}$

$\Rightarrow A=70304$

compound interest $=A-P$

= Rs. $70304$ - Rs. $62500$

= Rs.$7,804.$