Compound Interest - General Aptitude

Q1:

What is the difference between the compound interests on Rs. 5000 for 1 years at 4% per annum compounded yearly and half-yearly?

A Rs. 2.04

B Rs. 3.06

C Rs. 4.80

D Rs. 8.30

ANS:A - Rs. 2.04

C.I. when interest
compounded yearly    
= Rs. 5000 x 1 + 4 x 1 +  x 4
100 100
 
= Rs. 5000 x 26 x 51
25 50
  = Rs. 5304.
C.I. when interest is
compounded half-yearly
= Rs. 5000 x 1 + 2 3
100
 
= Rs. 5000 x 51 x 51 x 51
50 50 50
  = Rs. 5306.04
 Difference = Rs. (5306.04 - 5304) = Rs. 2.04