Question

A person deposited rs16000 in a bank M for two years at 10% compound interest annually. But after one year, the policy of has been changed by bank and decided to pay semi-annual compound interest at the same rate. What is the percentage difference between compound interest of the first and second years?

Answer 1

10%

Explanation:

semi-annual just means it pays twice a year, so 10% the first year and second year two 10% payments totaling 20% return on investment.