Q. 84.3( 72 Votes )
Arif took a loan of Rs. 80,000 from a bank. If the rate of interest is 10% per annum, find the difference in amounts he would be paying after 1
years, if the interest is compounded annually and compounded half yearly.
Answer :
For compounded Annually
Principal (P) = Rs. 80000
Time period (n) = 1
Rate of interest (R) = 10%
= 80000×1.053
= 88000
∴ Amount for 1 year = Rs. 88000
Interest for remaining 6 months = 
= 4400
∴ Amount for 1.5 years = Rs. 88000+4400 = Rs. 92400
= 92400-80000
∴ Compound Interest = Rs. 12400
For compounded half yearly
Principal (P) = Rs. 80000
Time period (n) = 3
Rate of interest (R) for half year = 10%×
= 5%
= 80000×1.053
= 92610
∴ Amount = Rs. 92610
= 92610-80000
∴ Compound Interest = Rs. 12610
∴ the difference in amounts = amount for For compounded half yearly - amount for For compounded annually
= 92610-92400
= Rs. 210
∴ The difference in amounts is Rs. 210
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