Q. A bank offers interest 5% compound interest calculated on half yearly basis. A customer deposited Rs 1600 each on 1st January and 1st July of a year. At the end of the year the amount he would have gained as interest is:

Rs 120

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Rs 121

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Rs 122

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Rs 123

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Solution

The correct option is B Rs 121
Total amount = 1600 $(1 + \frac{5}{2 \times 100})^{2} + 1600 (1 + \frac{5}{2 \times 100})$

= $1600 ((\frac{41}{400} \times \frac{14}{40} + \frac{41}{40}))$

$1600 \times \frac{41}{40} (\frac{41}{40} + 1)$
$= \frac{1600 \times 41 \times 81}{40 \times 40}$

=3321

CI earned = 3321 - 3200 = 121

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Q. A bank offers interest 5% compound interest calculated on half yearly basis. A customer deposited Rs 1600 each on 1st January and 1st July of a year. At the end of the year the amount he would have gained as interest is:

The correct option is B Rs 121Total amount = 1600 (1+52×100)2+1600(1+52×100) = 1600((41400×1440+4140)) 1600×4140(4140+1) =1600×41×8140×40 =3321 CI earned = 3321 - 3200 = 121