IndiaBIX

Aptitude - Compound Interest - Discussion

Discussion Forum : Compound Interest - General Questions (Q.No. 4)
Compound Interest
4.
What is the difference between the compound interests on Rs. 5000 for 1 years at 4% per annum compounded yearly and half-yearly?
Rs. 2.04
Rs. 3.06
Rs. 4.80
Rs. 8.30
Answer: Option
Explanation:

C.I. when interest
compounded yearly    
= Rs. 5000 x 1 + 4 x 1 + x 4
100 100
= Rs. 5000 x 26 x 51
25 50
= Rs. 5304.

C.I. when interest is
compounded half-yearly
= Rs. 5000 x 1 + 2 3
100
= Rs. 5000 x 51 x 51 x 51
50 50 50
= Rs. 5306.04

Difference = Rs. (5306.04 - 5304) = Rs. 2.04

Discussion:
85 comments Page 6 of 9.
Arslan said:   1 decade ago
As C.I = [1+4/100]^3/2.
= [1+.03]^3/2.
= 5302.980298.

Why?
Ritesh said:   10 years ago
Here formula used for amount but question is for C.I? How?

So please check it.
Simran said:   1 decade ago
How to solve for year and a half when asked in a question please tell me now?
Manikanta said:   1 decade ago
What about the Compound interest per year?

Why do we take [ 1/2 * 4 ] ?
Maggi said:   8 years ago
Yes, correct @Saikumar.

4% yearly given in ques. For half year 4/2 =2%.
Manohar said:   1 decade ago
Hello friends.

Thank you for sharing your views about that problem.
Manisha said:   1 decade ago
How we got 3/2 for half yearly for one and half year. please assist.
Stephen hawking said:   1 decade ago
Correct answer is 3.06.

CI 1 = 302.98 (not 304) and CI 2 = 306.04.
Deepthi said:   1 decade ago
How can we multiply 1/2 along with 4/100 when compounded annually?
Chandvi said:   1 year ago
How come 51/50? It must be 52/50, Right?

Anyone, explain to me.
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