Arif took a loan of Rs 80,000 from a bank. If the rate of interest is 10% per annum, find the difference in amounts he would be paying after 
years if the interest is
(i) compounded annually.
(ii) compounded half yearly.
(i) Here, Principal (P) = Rs. 80,000, Time, n = 1 1/2 years, Rate of interest (R) = 10%
Amount for 1 year (A) = 
= Rs. 88,000
Interest for 1/2 year = 
= Rs. 4,400
Total amount = Rs. 88,000 + Rs. 4,400 = Rs. 92,400
(ii) Here, Principal (P) = Rs.80,000,
Time, n = 
year = 3year (compounded half yearly)
Rate of interest (R) = 10% = 5% (compounded half yearly)
= Rs. 92,610
Difference in amounts
= Rs. 92,610 – Rs. 92,400 = Rs. 210
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