Answer :

**(i) Interest is compounded annually**

Here,

Principal (P) = Rs. 80,000, Time, n = years, Rate of interest (R) = 10%

We can break 1 and half year as 1 + 1/2.

So first we will calculate the Amount for 1 year

We know that the Amount is given by the formula

Now we have to calculate Amount for the left 1/2 year. For that we will use Rs. 88000 as the Principal and calculate simple Interest on this at the rate of 10%

Total amount = Rs. 88,000 + Rs. 4,400 = Rs. 92,400

**(ii)** Here, Principal (P) = Rs.80,000,

Time, n = 3/2 year = 3 year (compounded half yearly)

Rate of interest (R) = 10% = 5% (compounded half yearly)

Amount is given by the formulaAmount for 3 years at the rate of 5% interest will be

= Rs. 92,610

Amount when Compounded half yearly = Rs. 92610Difference in amounts

= Rs. 92,610 – Rs. 92,400 = Rs. 210

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