Find the compound interest on a sum of ₹50,000 at the rate of 6% per annum to be compounded half yearly at the end of 2 years. (Approximate to the nearest integer.)
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. ₹6,275
We know the formula for value after compound interest is = P × (1 + R/n)nt
Thus Interest received = Principal After Interest - Principal
Thus, Principal After Interest = (50,000) × (1 + )(2)(2)
= (50,000) × (1.03)4
~ 56,275
Interest = 56,275 - 50,000 = 6,275