Question

    Mitch placed Rs. 32,000 in a compound interest account

    with an annual rate of 30%, compounded semi-annually. After investing for a period of 15 months, calculate the total amount Mitch will receive by the end of this term.
    A Rs. 43,612 Correct Answer Incorrect Answer
    B Rs. 47,903 Correct Answer Incorrect Answer
    C Rs. 43,907 Correct Answer Incorrect Answer
    D Rs. 39,903 Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    Compound interest = Sum X {1 + (rate of interest/100) }time period - Sum Effective rate of interest = 30 ÷ 2 = 15% per term So, amount after 1 year = 32,000 X (1.15) 2 = Rs. 42,320 And interest charged in next 3 months = 42,320 X 15 X 3 ÷ (12 X 100) = Rs. 1,587 So, amount after 15 months = 42,320 + 1587 = Rs. 43,907

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