Correct Answer - Option 2 :
\(\frac{3}{2}\)years
Concept Used:
For half yearly, rate is halved and time period gets doubled.
Formula Used:
Amount = P × (1 + r/100)t
where, P → Principal, r → Rate of interest, t → Time period
Calculations:
Let the time period be t years.
Principal = Rs. 6250
Amount after compound interest = Rs. 6632.55
Rate of interest = 4%
For half-yearly,
⇒ 6632.55 = 6250 × (1 + (4/2)/100)2t
⇒ (6632.55/6250) = (51/50)2t
⇒ (132651/12500) = (51/50)2t
⇒ (51/50)3 = (51/50)2t
On comparing both, we get
2t = 3
⇒ t = 3/2 years
∴ The required time is 3/2 years.
When a sum is invested at half-yearly, then time gets doubled, so actual time for which money is invested is 3/2 years instead of 3 years.