If compounding is half- yearly, interest accrues in the second half of the year on the balance of the outstanding principal at the end of the first half.

Name: If compounding is half- yearly, interest accrues in the second half of the year on the balance of the outstanding principal at the end of the first half.
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In half-yearly compounding, interest is calculated twice a year. The interest for the second half is calculated on the principal plus any interest accrued in the first half.

If Compounding Is Half- Yearly, Interest Accrues in the Second