A sum of ₹1200 is invested at compound interest (compounded half yearly). If the rate of interest is 10% per annum, then what will be the amount after 18 months?

P = principal amount = ₹1200

R = rate of interest = 10% per annum

Interest is compounded half yearly. So the rate will be half. R = 5% per half yearly

N = time = 18 months

Interest is compounded half yearly. So N = 3. Because there are three slots of half year.

Amount after 18 months = $$1200\left(1+\frac{5}{100}\right)^3$$

= $$1200\left(1+\frac{1}{20}\right)^3$$

= $$1200\left(\frac{21}{20}\right)^3$$

= $$1200\times\frac{9261}{8000}$$

= $$3\times\frac{9261}{20}$$

= $$\frac{27783}{20}$$

= ₹1389.15