Find the compound interest on Rs.1,000 at 20% per annum for one year if interest is compounded half-yearly
Show answer & explanation
Correct answer: C
Explanation
The Correct answer is option 3 i.e. Rs. 210.
Given that
Principal = Rs. 1,000
Rate = 20% per annum and time = one year
if interest is compounded half-yearly,
Rate = 20/2 = 10% and TIme = 2 years
Formula used
Compound interest = Principal (1 + Rate/100)time - Principal
Calculation
C.I. = 1000 (1 + 10/100)2 - 1000
C.I. = 1000 (121/100) - 1000
C.I. = 1210 -1000 = Rs. 210