ABC26GN4184 · Compound Interest

Subject: General Aptitude · Chapter: Compound Interest · Exam: 2005 · Marks: · Difficulty:

The effective annual rate of interest corresponding to a nominal rate of 6\% per annum payable halfyearly is

(a)6.06\%

(b)6.07\%

(c)6.08\%

(d)6.09\%

Answer

Answer (as printed): D

Explanation

Amount of ₹ 100 for 1 year when compounded half- $$\text { yearly }=₹\left[100 \times\left(1+\frac{3}{100}\right)^{2}\right]=₹ 106.09 .$$ ∴ Effective rate $=(106.09-100) \%=6.09 \%$.

Explanation as extracted from the printed page; notation may be imperfect.

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