Question

Find the compound interest on Rs. $10,000$ for $\frac{2}{5}$ years at $20\%$ per annum, interest being payable half-yearly.

Answer 1

We know the formula,
$A=P{(1+\frac{r}{n})}^{n.t}$
Given, $P=$ Rs. $10000,r=20\%,n=2$ and $t=0.4$ years
Therefore, $A=10000{(1+\frac{0.2}{2})}^{2\times 0.4}$
$\Rightarrow A=10000\times {1.1}^{0.8}$
$\Rightarrow A=10000\times 1.07923$
$\Rightarrow A=$ Rs. $10792.3$
To find interest, we use formula

$A=P+I$, .....since $A=10792.3$ and $P=10000$

We have, $A=P+I$
$\Rightarrow 10792.3=10000+I$
$\Rightarrow I=10792.3-10000=792.3$
Interest, $I=$ Rs. $792.3$