Question

$2,000 at 12% rate for 3 yearswhat is the total amount?what is the compounded interest?

Answer 1

• The total amount is $2809.86.

,

• The compounded interest is $809.86.

Step-by-step explanation:

At compound interest, the amount in the account after t years is calculated using the formula below:

`A=P(1+r)^t`

Substituting the given values:

`\begin{gathered} A=2000(1+12\%)^3 \\ =2000(1+0.12)^3 \\ =2000(1.12)^3 \\ =2809.86 \end{gathered}`

The total amount is $2809.86.

Next, we find the compounded interest.

`\begin{gathered} \text{Amount}=\text{Principal}+\text{Interest} \\ 2809.86=2000+\text{Interest} \\ \text{Interest=}2809.86-2000 \\ \text{Interest=}809.86 \end{gathered}`

The compounded interest is $809.86.