What will Rs. 80,000 amount to in one year at 12% per annum, if the interest is compounded half-yearly?

Correct option is D

Given:

Principle = ₹80,000

Rate of interest = 12%

Time = 1 year

Formula Used:

Compounded Amount =$$Principle \times \left(1+ \frac{r}{100}\right)^{t}$$​​

Amount = Principle + Interest

Solution:

Rate of interest for half year = $$\frac{12}{2}$$ = 6%

Number of half year = 1$$\times$$​ 2 = 2 half years

Compounded Amount = $$80000 \times \left(1+ \frac{6}{100}\right)^{2}$$​​

​$$= 80000 \times \left(\frac{106}{100}\right)^2$$​​

​$$=80000 \times \frac{106}{100} \times \frac{106}{100}$$​​

= ₹89,888