Question

A sum of Rs. 6400 was invested at a rate of 24% for 1.5 years compounded half yearly. Find the compound interest.
1. Rs. 2791.54
2. Rs. 2291.54
3. Rs. 2591.54
4. Rs. 2991.54

Answer 1

Correct Answer - Option 3 : Rs. 2591.54

Given:

Principal(P) = Rs. 6400

Rate of Interest(r)  = 24%

Time =  1.5 years compounded half-yearly.

Formula used:

If the interest is compounded half yearly, the rate of interest will be halved and time will be doubled.

CI = P [1 + (R/100)]ⁿ - P

Calculation:

CI = 6400 [1 + (12/100)]³ - 6400

⇒ 8991.54 – 6400 = 2591.54

On Solving, we get

CI = Rs. 2591.54

∴ The compound interest is Rs. 2591.54