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Principal amount is Rs. 8000 which is invested at rate of interest 10% per annum compounded halfyearly. What will be the compound interest at end of 6 months?
Rs. 100
Rs. 200
Rs. 300
Rs. 400
Rs. 500
- The principal amount is Rs. 8000.
- The interest rate is 10% per annum, but it is compounded half-yearly. Therefore, the half-yearly rate is 5%.
- The formula for compound interest is:
$$ A = P \left(1 + \frac{r}{n}\right)^{nt} $$
where:
\( A \) is the amount,
\( P \) is the principal (Rs. 8000),
\( r \) is the annual interest rate (10% or 0.10),
\( n \) is the number of compounding periods per year (2 for half-yearly),
\( t \) is the time in years (0.5 for 6 months).
- Calculate:
$$ A = 8000 \left(1 + \frac{0.10}{2}\right)^{2 \times 0.5} $$
$$ A = 8000 \times 1.05 $$
$$ A = 8400 $$
- The compound interest is:
$$ \text{Compound Interest} = A - P = 8400 - 8000 = 400 $$
- Option 4: Rs. 400 is the correct answer.
By: Parvesh Mehta ProfileResourcesReport error
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