Multiple choice

What is the compound interest on Rs. 6000 at 10% per annum for one year compounded half yearly?

  1. Rs. 1260

  2. Rs. 630

  3. Rs. 615

  4. Rs. 600
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

For half-yearly compounding at 10% per annum, the half-yearly rate is 5% per half-year. In one year (2 half-years): Amount = 6000 × (1.05)² = 6000 × 1.1025 = Rs. 6615. Compound Interest = 6615 - 6000 = Rs. 615. Option A (Rs. 1260) would be 21% simple interest, wrong rate. Option B (Rs. 630) is 10.5% simple interest, wrong compounding. Option D (Rs. 600) is exactly 10% simple interest, ignoring compounding.

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