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Question

Compound interest on a sum of ₹ 5000 in 1.5 years when interest is compounded half-yearly at the rate 20% per annum is


A

₹ 1555

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B

₹ 1455

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C

₹ 1655

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D

₹ 1755

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Solution

The correct option is C

₹ 1655


Given:

P = ₹ 5000

R = 20% per annum, so will be 10% when compounded half-yearly

n = 3 (As 1.5 years has 3 half years in it)

Compound interest will be calculated by C.I
= [P × (1+R100)n]P

Substituting the values, we get,

C.I=[5000 × (1+10100)3]5000

C.I=[5000×1110×1110×1110]5000

C.I= 6655 5000

C.I= 1655


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