Question

Meena borrowed ₹ 40,000 at 10 % p.a simple interest. She immediately invested this money at 10 % p.a compounded half- yearly.Calculate Meena's gain in 18 months

• A. ₹ 6305
• B. ₹ 600
• C. ₹ 305
• D. ₹ 603

Answer 1

The correct option is C

₹ 305

Given P = ₹ 40,000 r = 10 % and n = $\frac{3}{2}$

S.I = $\frac{40,000\times 10\times 3}{2\times 100}$
= ₹ 6000

Amount in compound interest
A = 40,000$(1+\frac{10}{2\times 100}{)}^3)$ (∵ Interest is calculated half-yearly)
= $\frac{40,000\times 21\times 21\times 21}{20\times 20\times 20}$ = ₹ 46,305
C.I = ₹ 46,305 - ₹4 0,000
= ₹ 6305

Hence the gain is C.I - S.I = 6305 - 6000
= ₹ 305