Find the difference between Compound Interest and Simple Interest on Rs. 4000 for 1 year at 10% p.a., if the interest is compounded half-yearly.
Rs. 15
Rs. 30
Rs. 10
Rs. 20
Explanation:
Since, interest is compounded half-yearly.
Rate of interest is halved and time is doubled.
Rate = 102102% = 5% = 120120
And, Time = 2 x 1 = 2 half-years.
Therefore, Difference between Compound Interest and Simple Interest =
Rs. 4000 x 120120 x 120120 = Rs. 10
Since, interest is compounded half-yearly.
Rate of interest is halved and time is doubled.
Rate = 102102% = 5% = 120120
And, Time = 2 x 1 = 2 half-years.
Therefore, Difference between Compound Interest and Simple Interest =
Rs. 4000 x 120120 x 120120 = Rs. 10