Question

Find the amount of Rs$4096$ for $18$ months at $12\frac{1}{2}\%$ per annum, the interest being compounded semi-annually.

Answer 1

Given:

$P=$ Rs$4096$

$R=12.5\%$ p.a

$n=1.5$ years

We have:

$A=P{(1+\frac{R}{100})}^n$

When the interest is compounded annually, we have:

$A=P{(1+\frac{R}{200})}^{2n}$

$A=4096{(1+\frac{12.5}{200})}^3$

$A=4096{\left(1.0625\right)}^3$

$\therefore A=$ Rs $4913$

Thus, the required amount is Rs $4913$.