New Enroll in our GIC Finance Online Course Here!

    Register

    Question

    Rishi invested a sum of money for 2 years in a simple

    interest scheme at an annual rate of 30%, and received Rs. 7200 at the end of this period. Calculate the interest earned if the same amount is invested for 1 year at a compound interest rate of 30%, with interest being compounded every six months.
    A Rs. 5951.25 Correct Answer Incorrect Answer
    B Rs. 4967.87 Correct Answer Incorrect Answer
    C Rs. 5542.25 Correct Answer Incorrect Answer
    D Rs. 5266.75 Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    Let the sum invested by Rishi be Rs. 'x' So, the interest received by him after 2 years = (x X 2 X 0.30) = Rs. '0.6x' Hence, total amount received after 2 years = Rs. (0.6x + x) ATQ, Or, 1.6x = 7200 So, 'x' = 4500 Amount = Principal X {1 + (Rate/100) }Time Since, rate of interest is compounded half yearly, so rate = (30/2) = 15% And, Time period = (1 X 2) = 2 Therefore, required amount = 4500 X {(1 + (15/100) }2 = 4500 X (23/20) 2 = Rs. 5951.25

    Practice Next

    Relevant for Exams: