157k views
0 votes
NEED HELP ASAP!! NEED NOW!! THANK YOU!!

You deposit $1,000 and will receive 10% each year on your principal and interest. What is your 12th-year interest on interest? (Hint: It is not the total interest on interest earned over the 12 years.

1 Answer

2 votes

Answer: 12th-year interest on interest on an amount of $1,000 is $285.31.

Explanation: Here, principal, P=$1,000, rate, R= 10%, and time, T=12 years.

We have to compute the total interest at the end of 12 years.

we will use the formula,

Amount, A= P(1 + R/100)^T

Interest, I = A - P,

1. Interest at the end of 11 years,

I1 = 1000(1 + 10/100)^11

= 2853.12

2. Interest at the end of 12 years,

I1 = 1000(1 + 10/100)^12

= 3138.43

so, 12th-year interest on interest is,

I = I2 - I1

= 3138.43 - 2853.12

= 285.31

User ArashM
by
8.1k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories