What is the difference between the compound interest on Rs.12000 at 20% p.a. for one year when compounded yearly and half yearly?
Choose one.
A) Rs.140  B) Rs.120  C) Rs.130  D) Rs.110  E) None of these.
When compounded annually, interest   = 12000[1 + 20/100]1 - 12000 = Rs.2400   When compounded semi-annually, interest   = 12000[1 + 10/100]2 - 12000 = Rs.2520   Required difference = 2520 - 2400 = Rs.120   ANSWER:Rs.120
<result>B</result>
What is the difference between the compound interest on Rs.12000 at 20% p.a. for one year when compounded yearly and half yearly?