Question 95

# A bank offers 5% compound interest per half year. A customer deposits Rs. 9600 each on 1st January and 1st July of a year. At the end of the year, the amount he would have gained by way of interest is:

Solution

The interest earned on 9600 from Jan to July will be $$9600 \times 5 \times \frac{1}{100}$$ (Since rate of interest is 5 % per 6 months)

= $$96 \times 5 = 480$$

Hence, 9600 will amount to 10,080. He adds another 9600 to this. So the net amount becomes 9600 + 10080 = 19680.

Now interest earned on this amount in a period of 6 months will be $$19680 \times 5 \times \frac{1}{100} = 984$$

So the final amount will be 19680 + 984 = 20664

Total money he deposited = 9600 + 9600 = 19200

Hence, amount earned via interest = 20664 - 19200 = Rs 1464

=> Ans - (B)