A certain sum amounts to Rs 15,500 in 2 years at 12% p.a. simple interest. The same sum will amount to what in 1½ years at 10% p.a., if the interest is compounded half yearly (nearest to Rs 1)?
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. Rs 14,470
Concept
Amount = P + S.I
Application
Let Principal = 100P
Simple Interest for 2 years = 12% x 2 = 24%P
Total Amount = 100 P + 24P
= 124 P
Acccording to the question
124 P = 15,500
P = 125
Total Principal = 125 x 100 = 12, 500
As per the question, Rate of Interest for half yearly = 5%, , Time = 3 half years
Amount = P ( 1 + R/100)n
Putting the values
Amount = 12, 500 x ( 1 + 5/ 100) 3
12500 × (21/20)3
14470.31
14470 ( approx)