Compound Interest Time in Fractions


 
 
Concept Explanation
 

Compound Interest Time in Fractions

Calculating Compound Interest When Time is Given in Fractions:

When time is given as improper fraction, we first convert it into mixed fraction. The wehole number is used as its in the formula for compound Interest. and for the fraction part we will divide the rate with the fraction.

Let the principal be P and Rate is considered as R and suppose the time period is 15/4 years. then

  large We; will; first; convert; time ;into ;mixed; fraction ;as;3frac{3}{4}

large Amount = Pleft [ 1+frac{R}{100} right ]^3;X;left [ 1+frac{frac{3}{4}XR}{100} right ]

For Example:Reena borrowed 16000 at 12% rate of interest 4/3 years. Calculate the amount she had to pay in the end.

P= 16000 Rs

R= 12 %

T= 4/3

=large 1frac{1}{3} ;years

  large Amount = 16000left [ 1+frac{12}{100} right ]^1;X;left [ 1+frac{frac{1}{3}X12}{100} right ]

large Amount = 16000left [ 1+frac{3}{25} right ]^1;X;left [ 1+frac{4}{100} right ]

large Amount = 16000left [ frac{28}{25} right ];X;left [ 1+frac{1}{25} right ]

large Amount = 16000;X; frac{28}{25} ;X;frac{26}{25}=18636.8 Rs

 
Sample Questions
(More Questions for each concept available in Login)
Question : 1

Calculate compound interest if principal = Rs 10,000, rate of interest 8 % , time period is 1 year 3 months. Compounded annually

Right Option : C
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Explanation
Question : 2

An amount of 12000 is deposited in a bank at 10% p.a for 2 years and 6 months compounded per annum. Find the value of the relation

 2times Amount+3times Compound ; Interest

Right Option : C
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Explanation
Question : 3

Find the compound interest on an amount of Rs 7000 at rate of interest 10 %  when time period is 1 year 6 months. The amount is compounded annually

Right Option : A
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Explanation
 
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