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Mathematics

Find the amount and the compound interest on ₹50000 for 1121\dfrac{1}{2} years at 8% per annum, the interest being compounded semi-annually.

Compound Interest

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Answer

Since, the rate of interest is 8% per annum, therefore, the rate of interest half-yearly = 12\dfrac{1}{2} of 8% = 4%.

Principal for first half-year = ₹50000.

Interest for first half-year = 50000×4×1100=200000100\dfrac{50000 \times 4 \times 1}{100} = \dfrac{200000}{100} = ₹2000.

Amount after first half-year = ₹50000 + ₹2000 = ₹52000.

Principal for second half-year = ₹52000.

Interest for the second half-year = 52000×4×1100=208000100\dfrac{52000 \times 4 \times 1}{100} = \dfrac{208000}{100} = ₹2080.

Amount after one year = ₹52000 + ₹2080 = ₹54080.

Principal for third half-year = ₹54080.

Interest for the third half-year = 54080×4×1100=216320100\dfrac{54080 \times 4 \times 1}{100} = \dfrac{216320}{100} = ₹2163.20

Amount after 1121\dfrac{1}{2} year = ₹54080 + ₹2163.20 = ₹56243.20

Compound interest for 1121\dfrac{1}{2} year = Final amount - principal = ₹56243.20 - ₹50000 = ₹6243.20

Hence, the amount and the compound interest on ₹50000 for 1121\dfrac{1}{2} years at 8% per annum, the interest being compounded semi-annually are ₹56243.20 and ₹6243.20 respectively.

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