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Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a interest compounded quarterly 4
(a) Rs. 642/-
(b) Rs. 630.78/-
(c) 634.68/-
(d) Rs. 624.48/-?
(a) Rs. 642/-
(b) Rs. 630.78/-
(c) 634.68/-
(d) Rs. 624.48/-?
Most Upvoted Answer
Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a int...
Understanding Compound Interest
Compound interest is calculated on the initial principal, which also includes all the accumulated interest from previous periods. Here, we will compute the compound interest for Rs. 6,000 over 1 year at an 8% annual interest rate, compounded quarterly.
Key Information
- Principal (P): Rs. 6,000
- Annual Interest Rate (r): 8% or 0.08
- Time (t): 1 year
- Compounding Frequency (n): Quarterly (4 times a year)
Steps to Calculate Compound Interest
1. Convert the annual rate to quarterly:
- Quarterly interest rate = r/n = 0.08 / 4 = 0.02 (or 2%)
2. Determine the total number of compounding periods:
- Total compounding periods (n × t) = 4 × 1 = 4
3. Use the compound interest formula:
- A = P(1 + r/n)^(nt)
- A = 6000(1 + 0.02)^(4)
4. Calculate the amount (A):
- A = 6000(1.02)^4
- A ≈ 6000 × 1.08243216 ≈ 6494.59
5. Calculate the compound interest (CI):
- CI = A - P
- CI = 6494.59 - 6000 ≈ 494.59
Final Result
The compound interest earned on Rs. 6,000 for 1 year at 8% p.a. compounded quarterly is approximately Rs. 494.59.
None of the options (a) Rs. 642, (b) Rs. 630.78, (c) Rs. 634.68, or (d) Rs. 624.48 match this computed interest. Thus, it seems there may be an error in the options provided.
Compound interest is calculated on the initial principal, which also includes all the accumulated interest from previous periods. Here, we will compute the compound interest for Rs. 6,000 over 1 year at an 8% annual interest rate, compounded quarterly.
Key Information
- Principal (P): Rs. 6,000
- Annual Interest Rate (r): 8% or 0.08
- Time (t): 1 year
- Compounding Frequency (n): Quarterly (4 times a year)
Steps to Calculate Compound Interest
1. Convert the annual rate to quarterly:
- Quarterly interest rate = r/n = 0.08 / 4 = 0.02 (or 2%)
2. Determine the total number of compounding periods:
- Total compounding periods (n × t) = 4 × 1 = 4
3. Use the compound interest formula:
- A = P(1 + r/n)^(nt)
- A = 6000(1 + 0.02)^(4)
4. Calculate the amount (A):
- A = 6000(1.02)^4
- A ≈ 6000 × 1.08243216 ≈ 6494.59
5. Calculate the compound interest (CI):
- CI = A - P
- CI = 6494.59 - 6000 ≈ 494.59
Final Result
The compound interest earned on Rs. 6,000 for 1 year at 8% p.a. compounded quarterly is approximately Rs. 494.59.
None of the options (a) Rs. 642, (b) Rs. 630.78, (c) Rs. 634.68, or (d) Rs. 624.48 match this computed interest. Thus, it seems there may be an error in the options provided.
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Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a interest compounded quarterly 4(a) Rs. 642/-(b) Rs. 630.78/-(c) 634.68/-(d) Rs. 624.48/-?
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Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a interest compounded quarterly 4(a) Rs. 642/-(b) Rs. 630.78/-(c) 634.68/-(d) Rs. 624.48/-? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a interest compounded quarterly 4(a) Rs. 642/-(b) Rs. 630.78/-(c) 634.68/-(d) Rs. 624.48/-? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a interest compounded quarterly 4(a) Rs. 642/-(b) Rs. 630.78/-(c) 634.68/-(d) Rs. 624.48/-?.
Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a interest compounded quarterly 4(a) Rs. 642/-(b) Rs. 630.78/-(c) 634.68/-(d) Rs. 624.48/-? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a interest compounded quarterly 4(a) Rs. 642/-(b) Rs. 630.78/-(c) 634.68/-(d) Rs. 624.48/-? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Compute the compound interest on Rs. 6,000/- for 1 years at 8% p.a interest compounded quarterly 4(a) Rs. 642/-(b) Rs. 630.78/-(c) 634.68/-(d) Rs. 624.48/-?.
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