Question

Find the compound interest on Rs.$8000$ for the period of $1\frac{1}{2}$ years at the rate of interest $10$% per annum, if the interest is compounded half yearly.

Answer 1

Given Principle $P=Rs.8000$

Time $t=1\frac{1}{2}=\frac{3}{2}years$

But, as the interest is compounded half yearly $t=\frac{3}{2}\times 2=3years$

Rate of interest $R=10$

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

$A=8000{(1+\frac{10}{100})}^3$

$A=8000{\left(\frac{110}{100}\right)}^3$

$A=8000\times {\left(1.1\right)}^3$

$A=8000\times 1.331$

$A=10648$

$CI=A-P$

$CI=10648-8000$

$CI=Rs.2648$