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Find the future value and compound interest if £9000 is invested for 3 years at 5.1% p.a.

a) Future Value: £9918, Compound Interest: £918
b) Future Value: £8918, Compound Interest: £918
c) Future Value: £9918, Compound Interest: £818
d) Future Value: £8918, Compound Interest: £818

User Prazhus
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1 Answer

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Final answer:

The future value of £9000 invested for 3 years at 5.1% p.a. is £9918, and the compound interest earned is £918.

Step-by-step explanation:

To find the future value and compound interest, we can use the formula:

Future Value = Principal × (1 + interest rate)time
Compound interest = Future Value - Present Value

In this case, the principal is £9000, the interest rate is 5.1% per annum, and the time is 3 years. Plugging these values into the formula, we can calculate the future value and compound interest as follows:

  • Future Value = £9000 × (1 + 0.051)3 = £9918
  • Compound Interest = £9918 - £9000 = £918

Therefore, the correct answer is a) Future Value: £9918, Compound Interest: £918.

User Skulled
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