Question : INR 12,000 is lent for one year at the rate of 15 % per annum, the interest being compounded annually. If the compounding of the interest is done half-yearly, then how much more interest will be obtained at the end of the one year on the same initial sum?
Option 1: INR 72.5
Option 2: INR 82.8
Option 3: INR 60.5
Option 4: INR 67.5
Don't Miss: Month-wise Current Affairs | Upcoming Government Exams
Correct Answer: INR 67.5
Solution :
Principal, $P = 12000$
Term, $n = 1$ year
Rate, $R = 15$%
When compounded half-yearly,
Compound Interest, CI = $P(1+\frac{R}{200})^{2n}-P$
= $12000 × (1+\frac{15}{200})^2 - 12000$
= $12000 × (\frac{215}{200})^2 - 12000$
= $12000 × (\frac{43}{40})^2 - 12000$
= $12000 × \frac{1849}{1600} - 12000$
= $13867.5 - 12000$
= $1867.5$
When compounded annually,
Compound Interest, CI = $P(1+\frac{R}{100})^{n}-P$
= $12000 × (1+\frac{15}{100})^1 - 12000$
= $12000 × \frac{15}{100}$
= $1800$
Required difference = $1867.5 - 1800$
= $67.5$
Hence, the correct answer is INR 67.5.
Related Questions
Know More about
Staff Selection Commission Multi Tasking ...
Answer Key | Cutoff | Selection Process | Preparation Tips | Eligibility | Application | Exam Pattern
Get Updates BrochureYour Staff Selection Commission Multi Tasking Staff Exam brochure has been successfully mailed to your registered email id “”.




