A principal amount is invested at a compound interest rate of 20% for 2 years. If the interest is compounded semi-annually instead of annually, the total interest earned increases by Rs. 482. What is the original principal?

Explanation

Let the principal be P. When compounded annually, the amount after 2 years is P × (6/5)^2. When compounded semi-annually, the amount after 2 years is P × (11/10)^4. The difference in amounts is Rs. 482, so: P × (11/10)^4 - P × (6/5)^2 = 482 Solving this equation, we find P = Rs. 2000.