A sum of money was invested at 10% interest per year, compounded half-yearly, for 18 months. If the amount payable on maturity was ₹64,827, what was the sum invested?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. Rs. 56,000.
Given that
Rate of compound interest R = 10% p.a.
Time = 18 months = 1.5 years
If the amount payable on maturity was ₹64,827
If compounded half yearly,
The rate (R) = 10/2 = 5%
Time = 1.5 × 2 = 3 years
Formula used
Amount = Principal (1+ R/100)time
Calculation
⇒ 64827 = Principal (1 + 5/100)3
⇒ 64827 = Principal (21/20)3
⇒ Principal = 64827 × 8000/9261 = ₹56,000