Question

Compound interest on a sum of ₹ 15000 in 2.5 years when interest is compounded half-yearly at the rate 10% per annum is

• A. ₹ 4,044 (approx)
• B. ₹ 4,144 (approx)
• C. ₹ 4,244 (approx)
• D. ₹ 4,344 (approx)

Answer 1

The correct option is B

₹ 4,144 (approx)

Given:

P = ₹ 15000

R = 10% per annum, so will be 5% when compounded half-yearly

n = 5 (As 2.5 years has 5 half years in it)

Compound interest will be calculated by C.I = [$P\times (1+\frac{R}{100}{)}^n$] - P

Substituting the values, we get,

C.I = [$15000\times (1+\frac{5}{100}{)}^5$] - 15000

C.I = [$15000\times (1+\frac{1}{20}{)}^5$] - 15000

C.I = ₹ 19144.2234375 - ₹ 15000

C.I = ₹ 4,144.2234375, which is approximately ₹ 4,144