Given:
R = 18% p.a.
P = Rs. 10000
N = 1 / 2 year
Formula used:
Effective rate = R + R + (R2/ 100)
A = P × {1 + (R / 100)}N
Where P = Principal amount, R = Rate of interest in %, N = Number of years
Calculation:
Here, Rate of interest compounded half yearly = (18/2)%
⇒ Effective annual rate = 9 + 9 + (81/100)
⇒ Effective annual rate = 18.81%
A = 10,000 × {1 + (18.81 / 100)}
⇒ A = 10,000 + 1881
⇒ A = 11881
∴ Required answer is 18.81% and Rs. 11,881