A sumof money is lent out at compound interest rate of 20% per annum, componding annually for two years. It would fetch ₹3,133 more interest, if interest is compounding half yearly. Find the sum.
Show answer & explanation
Correct answer: C
Explanation
The correct answer is Option 3 i.e. ₹1,30,000.
For half yearly
R = R/2 and T = 2T
According to the question
⇒ 3133 = P(1 + 10/100)4 - P(1 + 20/100)2
⇒ 3133 = P(1 + 1/10)4 - P(1 + 1/5)2
⇒ 3133 = P(11/10)4 - P(6/5)2
⇒ 3133 = P(14641/10000) - P(36/25)
⇒ 3133 = P(14641/10000 - 36/25)
⇒ 3133 = P(14641/10000 - 14400/10000)
⇒ 3133 = P(241/10000)
⇒ P = (3133 × 10000)/241
⇒ P = Rs.130000