Question

Vasudevan invested $Rs.60000$ at an interest rate of $12\%$ per annum compounded half-yearly. What amount would he get

(i) after $6$ months?

(ii) after $1$ year?

Answer 1

(i) Principal, $P=Rs.60,000$

Rate, $R=12\%$ per annum $=6\%$ per half year

$n=6$ months $=1$ half year

Amount, $A=P[1+\frac{R}{100}{]}^n$

$=60000[1+\frac{6}{100}{]}^1$

$=60000\left(\frac{106}{100}\right)$

$=Rs.63600$

(ii) There are 2 half years in 1 year.

n = 2

Amount, $A=P[1+\frac{R}{100}{]}^n$

$=60000[1+\frac{6}{100}{]}^2$

$=60000\left(\frac{106}{100}\right)\times \left(\frac{106}{100}\right)$

$=Rs.67416$