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    Question

    Rahul invested ₹4,000 in a

    scheme offering a compound interest rate of 16% per annum, compounded semi-annually. Calculate the total interest earned by him in 24 months.
    A ₹2,442 Correct Answer Incorrect Answer
    B ₹1,442 Correct Answer Incorrect Answer
    C ₹5,042 Correct Answer Incorrect Answer
    D ₹2,540 Correct Answer Incorrect Answer

    Solution

    ATQ,

    Effective Rate: 16/2 = 8% per 6 months. Number of Periods: 24/6 = 4. Compound Interest Formula

    Substitute values: A = 4000×(1.08)4 = 4000×1.3605 = ₹5,442.

    Interest Earned = A−P = ₹5,442−₹4,000 = ₹1,442.

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