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Katarina [22]
2 years ago
10

$800 at 7% compounded annually for 2 years

Mathematics
1 answer:
Marina86 [1]2 years ago
7 0

Answer:

$115.92

Step-by-step explanation:

To calculate compound interest, which Amount - Principal but we dont know the value for amount so we find the amount first by using the formula.

               A =  P ( 1 +   <u>R</u> ) ^n

                                 100      

where p = principal    ($800)            

a =  amount       (?)

r =  interest rate    (7%)

n = time ( no of years)    (2)

A  =  800   ( 1   +   <u>7 </u>) ^2

                          100                  A = 800 ( 1 + 0.07) ^2

                                                  A = 800 ( 1.07)^2   = 800 ( 1.1449)

A = 915.92.

We then find compound interest with:    

C = Amount - Principal   =   $915.92  -  $800    =    $115.92

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