Question

How much will Rs. 25,000 invested at compound interest amount to in 1 year at 4% per annum compounded half yearly?
1. Rs. 25,980
2. Rs. 26,010
3. Rs. 26,100
4. Rs. 26,001

Answer 1

Correct Answer - Option 2 : Rs. 26,010

Given:

Principle is 25000

Rate is 4%

Time is 1 year and CI is calculated Half Yearly

Formula Used:

Compound Interest (CI) = P × (1 + R/100)ⁿ

Calculation: 

CI is calculated Half Yearly so Rate = 4/2 = 2 %

⇒ Time becomes 2 years

⇒ CI in 2 years = 25000 × (1 + 2/100)² = 26010