Question

Mary invests £12000 in a savings account. The account pays 1.5% compound interest per year. Work out the value of her investment after 2 years

Answer 1

$\bf \qquad \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+\frac{r}{n}\right)^{nt} \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\to &12000\\ r=rate\to 1.5\%\to \frac{1.5}{100}\to &0.015\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{per year, thus once} \end{array}\to &1\\ t=years\to &2 \end{cases} \\\\\\ A=12000\left(1+\frac{0.015}{1}\right)^{1\cdot 2}$