2600 × 1.05 = £2730 We work out how much interest he receives in one year. To do this, we find a decimal multiplier using 5%. We divide 5 by 100, giving us 0.05 and then add 1 to that. The 1 represents the increase of interest.
2730 - 2600 = 130 We subtract to find out how much interest has been gained already.
130 × 4 = £520 Now we multiply that by the number of years to predict how much interest he will inherit by the end of the 4 years.
