Multiple choice

If the rate of compound interest is 15% per annum and a fixed amount is invested for a period of 1 year 6 months and the compound interest obtained is Rs 9.45, then what is the value of the fixed amount?

  1. 44

  2. 40

  3. 48

  4. 50
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Using CI formula: CI = P[(1 + r/100)^t - 1]. For 1.5 years at 15%: CI = P[(1.15)^(3/2) - 1]. Using half-yearly: CI = P[(1 + 7.5/100)³ - 1] = P[1.075³ - 1] = P[0.2423]. If CI = 9.45, then P = 9.45/0.236 = 40. Alternatively, for 1 year 6 months at 15%: P = 9.45/0.23625 ≈ 40.

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