Question

5. Peter invests £3550 into a savings account at 3.05% per annum. How much

will he have in his bank account at the end of 5 years?

Answer 1

since it's per annum, we'll assume is compounded interest.

`~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+(r)/(n)\right)^(nt) \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\dotfill &\pounds 3550\\ r=rate\to 3.05\%\to (3.05)/(100)\dotfill &0.0305\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{per annum, thus once} \end{array}\dotfill &1\\ t=years\dotfill &5 \end{cases} \\\\\\ A=3550\left(1+(0.0305)/(1)\right)^(1\cdot 5)\implies A=3550(1.0305)^5\implies A\approx 4125.42`