Arithmeticmedium · Past Paper

How much more interest will Rs 50000 yield in 1 year at 10% per annum if compounded semi-annually than if compounded annually?

ARs 125
BRs 250
CRs 500
DRs 0

✓ Correct Answer: ARs 125

Annual CI = 5000. Semi-annual CI = 50000(1.05^2 - 1) = 50000(0.1025) = 5125. Difference = 125.

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