The balance after 3 years is $787.5
Compound interest is a financial concept where interest is calculated not only on the initial principal amount but also on the accumulated interest from previous periods.
Amount of compound interest is expressed as
A = P ( 1+r)ⁿ
where n is the number of years it's compounded and A is the amount and p is the Principal.
A = 700( 1+ 0.04)³
A = 700( 1.04)³
A = 700 × 1.125
A = $787.5
Therefore, at the end of 3 years the balance will be $787.5