Question

Sally agreed a compound interest of 5.5% for a fixed term. If she invested £800 to this agreement, then what was her total at the end of 5 years?

Answer 1

Answer:

£1045.57

Step-by-step explanation:

Using compound interest formula then

$A=P(1+i)^{n}$

Where A= the future value of the investment/loan, including interest

P = the principal investment amount

r = the annual interest rate

n = the number of times that interest is compounded per unit t

$A=800(1+0.055)^{5}\approx 1045.57$

Hence her amount t the end of 5 yrs is $1045.57