Arithmetic Ability
Compound Interest

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Q.

What is the difference between the compound interests on Rs. 5000 for 1 1/2 years at 4% per annum compounded yearly and half-yearly?

View Answer

Correct choice: B

Explanation:

C.I. when interest compounded yearly Rs.[5000*(1+4/100)*(1+1/2*4/100)] Rs.[5000*26/25*51/50] =Rs.5034 C.I. when interest iscompounded half-yearly Rs.[5000*(1+2/100)3] = Rs. 5306.04 Difference = Rs. (5306.04 - 5304) = Rs. 2.04
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