Question

Dan invests £9200 into his bank account. He receives 4% per year compound interest. How much will Dan have after 2 years? Give your answer to the nearest penny where appropriate.

Answer 1

Answer:

£9950.72

Step-by-step explanation:

Hello,

The question above relates to compound interest and to solve it, we'll require the formula needed.

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

A = compound interest

P = principal = £9200

r = rate = 4% = 0.04

n = number of times the interest is compounded = 1

T = time = 2 years.

A = 9200 × (1 + 0.04/1)^(1×2)

A = 9200 × (1.04)²

A = 9200 × 1.0816

A = 9950.72

Dan would have £9950.72 after 2 years