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 7 of 9.
Aswathi said:
1 decade ago
Explanation for the amount when compounded yearly is as below:
We learn from our formulas that when interest is compounded, annually but time is in fraction then it should be:
Amount = P*(1+r/100)^1*(1+(1/2*4)/100).
Please check general formula section 5.
We learn from our formulas that when interest is compounded, annually but time is in fraction then it should be:
Amount = P*(1+r/100)^1*(1+(1/2*4)/100).
Please check general formula section 5.
Deepthi said:
1 decade ago
What is the actual equation for CI calculated annually?
Deepthi said:
1 decade ago
How can we multiply 1/2 along with 4/100 when compounded annually?
Shivanath said:
1 decade ago
What is the compound interest formula for full year. Tell the general nth year formula?
Simran said:
1 decade ago
How to solve for year and a half when asked in a question please tell me now?
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.
Sneh said:
1 decade ago
How we can compound half yearly means I did not understand how 3 can come means n=3 ?
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).
Roop said:
1 decade ago
Why 1/2*4 instead of (1+4/100)^1/2 ?
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.
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