A cooperative society offers 8% per annum compounded half-yearly, while a small bank next door offers 8.16% per annum compounded annually. Ravneet places ₹50000 with each for exactly 2 years. The difference between the two maturity amounts (in ₹) is:

Half-yearly at 8% means 4% twice a year, so one year multiplies the money by $(1.04{)}^2=1.0816$ — precisely the bank's annual factor. Both deposits therefore grow by 1.0816 each year and stand at $50000\times 1.$$0816^2$ = ₹58492.93 after 2 years, a difference of ₹0. (Reading the 0.16 gap in the quoted rates as real money gives 0.16% of 50000 = ₹80 for one year or ₹160 for two; the whole point is that 8.16% annually IS 8% half-yearly.)