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  1. What will be the compound interest of Rs. 8000 at 10% p.a. for 11/2 years. When compound interest is payable half yearly ?
    1. Rs. 1261
    2. Rs. 1385
    3. Rs. 1480
    4. Rs. 1255
Correct Option: A

Yearly interest = 10%
Half yearly = 5%
Time = 11/2 = (3/2) x 2 half yearly = 3 half yearly
Amount = 8000(1 + 5/100)3
= 8000 x (21/20)3
= 8000 x 21/20 x 21/20 x 21/20
= Rs. 9261

Compound interest = Amount - Principal = 9261 - 8000
= Rs. 1261



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