Chemical Engineering - Chemical Engineering Plant Economics - Discussion
Discussion Forum : Chemical Engineering Plant Economics - Section 1 (Q.No. 31)
31.
If the interest rate of 10% per period is compounded half yearly, the actual annual return on the principal will be __________ percent.
Discussion:
2 comments Page 1 of 1.
Sikret said:
6 days ago
After first 6 months:
100×(1+0.10) = 110.
After next 6 months:
110×(1+0.10) = 121.
So total return after 1 year = 121,
Effective Annual Return:
EAR = (121−100)/×100% = 21%.
100×(1+0.10) = 110.
After next 6 months:
110×(1+0.10) = 121.
So total return after 1 year = 121,
Effective Annual Return:
EAR = (121−100)/×100% = 21%.
Kshitij said:
4 years ago
Can anyone explain this? I'm not getting it.
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