Question

Mary invests £12000 into a savings account. The account pays 1.5% compound interest per year

Answer 1

Mary will earn $1800 of interest each year 

Answer 2

Answer:

Value of her investment after 2years is £12,362.7

Step-by-step explanation:

The question is incomplete, here is the complete 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 two years"

Using the relationship:

A = P(1+r/100)^n

Where P is the principal = amount invested = £12000

r is the compound interest = 1.5%

n is the time = 2years

A is the amount compounded after n years

A = 12000(1+1.5/100)²

A = 12000(1+0.015)²

A = 12000(1.015)²

A = 12000(1.03)

A = 12362.7

Value of her investment after 2years is £12,362.7