Answer:
1. CI = P (1 +
)^ n - P
CI = A - P
Where P is Principal
R is interest rate
n is number of years
2. a. Semi annually - four times in a year
b. Monthly - two times in a year
c. annually - once in a year
Explanation:
1. Money is said to be lent at compound interest , when the interest has become due at certain fixed period say, one year, half year, etc.., is given not paid to money lender, but is added to sum lent . The amount thus obtained become principal for next month and this process repeat until last period .
i.e CI = Final period - Initial period
or CI = A - P
or CI = P(1+
) ^n - P
2. (a) Semi annually
A = P (1 +
)^ n × 4
(b) Monthly
A = P (1 +
) ^ n × 2
(c) Annually
A = P (1 +
) ^ n