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Lyrx [107]
4 years ago
15

stephen invests £7500 in an account which pays 5.5% compound interest per annum. Stephen has to pay 20% tax on the interest each

year. the tax is taken from the account at the end of each year. How much money will stephen have in his account after two years? Give your answer to the nearest penny.
Mathematics
1 answer:
garri49 [273]4 years ago
5 0
Interest earned
7,500×0.055
=412.5
Deduct tax
412.5−412.5×0.2
=330
Add the remaining interest
330+7,500
=7,830
Calculate interest earned in the second year
7,830×0.055
=430.65
Deduct tax
430.65−430.65×0.2
=344.52
Add the remaining interest
344.52+7,830
=8,174.52. ...answer
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