Find the compound interest, if Tk. 1000 was invested for 1.5 years at 20% p.a. compounded half yearly.

Question: Find the compound interest, if Tk. 1000 was invested for 1.5 years at 20% p.a. compounded half yearly.

Solution:
As it is said that the interest is compounded half yearly. So, the rate of interest will be halved and time will be doubled.
CI = P [1 + (R/100)]ⁿ - P
CI = 1000[1 +(10/100)]³ - 1000
CI = 1000 × 1.1 × 1.1 × 1.1 - 1000
CI = 1331 - 1000
CI = 331