What is the difference (in Rs) in Compound interest earned in 1 year on a sum of Rs 25,000 at 20% per annum compounded semi-annually and annually?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2, i.e. 250
Difference = [25000(1+10/100)2 - 25000] - [(25000×1×20)/100]
=25000(121/100 - 1) - 5000 = 5250 - 5000 = Rs 250