Kiran invests ₹16,000 at 10% per annum, compounded half-yearly. What is the amount after 1 year?

₹1,640Correct answerYour answer₹17,600Correct answerYour answer₹17,640Correct answerYour answer₹19,360Correct answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer C

Correct answer: C

Half-yearly: rate per half-year = $10\% \div 2 = 5\%$ , and 1 year = 2 half-years.
Amount = $16000 \times (1.05)^2 = 16000 \times 1.1025 = 17640$ .
The amount is ₹17,640.

Worth noting

₹17,600 compounds only once (annually). ₹19,360 wrongly uses 10% for each half-year; the yearly rate must be halved.

Ten questions from Simple & Compound Interest, at your own pace.

Ten questions from Simple & Compound Interest, at your own pace.

Explanation