Question

Brian invests £1850 into his bank account. He receives 2.7% per year simple interest. How much will Brian have after 3 years? Give your answer to the nearest penny where appropriate.

Answer 1

£1999.85

Explanation:

A = P(1 + rt)

Where:

A = Amount after t years

P = Initial amount invested = £1850

r = Interest rate = 2.7%

t = Time in years = 3 years

Calculation:

First, converting R percent to r a decimal

r = R/100 = 2.7%/100 = 0.027 per year.

Solving our equation:

A = £1850(1 + (0.027 × 3))

A = £1999.85

Therefore, Brian will have £1999.85 after 3 years.