Multiple choice

Find the compound interest on ₹35,000 in 2 years at 6% per annum, the interest being compounded half-yearly (nearest to a ₹):

  1. ₹4,000

  2. ₹4,193

  3. ₹4,393

  4. ₹4,388
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Principal = 35,000, rate = 6% p.a. compounded half-yearly means 3% per half-year for 4 periods. Amount = 35000(1.03)⁴ = 35000 × 1.1255 = 39,393. Compound Interest = 39,393 - 35,000 = 4,393. Option C matches this calculation. Verify: (1.03)⁴ = 1.1255088, times 35000 = 39392.8, nearest rupee is 39393.

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