Question

VelS

58%
If £2000 is placed into a bank account that pays 3% compound interest per year,
how much will be in the account after 2 years?​

Answer 1

the amount after 2 years is £2,121.80

Explanation:

The computation of the amount after 2 years is shown below:

As we know that

Future value = Present value × (1 + rate of interest)^number of years

= £2,000 × (1 + 0.03)^2

= £2,000 × 1.03^2

= £2,000 × 1.0609

= £2,121.80

Hence, the amount after 2 years is £2,121.80