Question

$Rs.8,000$ for $1$ year at $9\%$ per annum compounded half-yearly.

Calculate compound interest and the total amount after 1 year.

Answer 1

Given: Principal, $P=Rs.8,000$

Rate, $R=9\%$ per annum

Time, $T=1$ year

number of half years, $n=1$ (in 1 year)

Rate @ half yearly $=\frac{9}{2}=4.5\%$

Amount is given by the formula

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

$=8000[1+\frac{\frac{9}{2}}{100}{]}^2$

$=8000\times \frac{209}{200}\times \frac{209}{200}$

$=Rs.8736.2$

Compound Interest = Amount- Principal

$=8736.2-8000=Rs.736.20$