Compound interest on a certain sum of money invested for 1.5 years at the rate of 10% per annum, compounded half-yearly is ₹5,044. What is the sum?
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. ₹32,000.
Rate per half-year = 10% ÷ 2 = 5%
Time = 1.5 years = 3 half-years
Let principal = P
Amount = P × (1 + 5/100)³ = P × (21/20)³ = P × 9261/8000
CI = ₹5044 = P × (9261/8000 − 1) = P × 1261/8000
⇒ P = 5044 × 8000 / 1261 = ₹32,000