Aptitude - Compound Interest - Discussion
Discussion Forum : Compound Interest - General Questions (Q.No. 4)
4.
What is the difference between the compound interests on Rs. 5000 for 1
years at 4% per annum compounded yearly and half-yearly?
years at 4% per annum compounded yearly and half-yearly?
Answer: Option
Explanation:
| C.I. when interest compounded yearly |
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| = Rs. 5304. |
| C.I. when interest is compounded half-yearly |
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| = Rs. 5306.04 |
Difference = Rs. (5306.04 - 5304) = Rs. 2.04
Discussion:
85 comments Page 2 of 9.
Afsha said:
1 decade ago
Finding it tuff to understand can anyone please make it easy for me from first step.
Tarun said:
1 decade ago
When interest is compounded annually,
Amount = p[1+(r/100)]^t.
When interest is compounded half yearly,
Amount = p[1+(r/2x100)]^2t.
Amount = p[1+(r/100)]^t.
When interest is compounded half yearly,
Amount = p[1+(r/2x100)]^2t.
Qutub said:
1 decade ago
How "C. I. When interest compounded yearly" is calculated?
Shakti said:
1 decade ago
When interest is compounded annually~ Yearly,
Amount(A) = p[1+(r/100)]^t.
CI = P-A.x
Amount(A) = p[1+(r/100)]^t.
CI = P-A.x
Arslan said:
1 decade ago
As C.I = [1+4/100]^3/2.
= [1+.03]^3/2.
= 5302.980298.
Why?
= [1+.03]^3/2.
= 5302.980298.
Why?
Akshay said:
1 decade ago
Why is is 1+[(1/2)*4/100] when it should be 1+(4/100)^1/2 when the interest is compounded annually.
Roop said:
1 decade ago
Why 1/2*4 instead of (1+4/100)^1/2 ?
Roop said:
1 decade ago
@Akshay and @Arslan.
When time is in fraction that is 3/2 then the formula is:
A = P[(1+R/100)*{1+(R/2)/100).
When time is in fraction that is 3/2 then the formula is:
A = P[(1+R/100)*{1+(R/2)/100).
Sneh said:
1 decade ago
How we can compound half yearly means I did not understand how 3 can come means n=3 ?
Divya said:
1 decade ago
Compound interest indicates interest on interest.
So we can calculate it as:
CI1 = 5000*(4/100)*1 = 200.
But I don't know to calculate, CI2 for 1/2 year.
Such that compound interest CI = CI1+CI2.
So we can calculate it as:
CI1 = 5000*(4/100)*1 = 200.
But I don't know to calculate, CI2 for 1/2 year.
Such that compound interest CI = CI1+CI2.
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