Answer:
a. $270
b. $3,278.18
Explanation:
Given that
The principal amount is $3,000
Annual rate of interest is 3%
And, the time period is 3 years
We need to find out the simple interest & compound interest
The following formulas should be used
a. For simple interest
= Principal × rate of interest × time period
= $3,000 × 3% × 3 years
= $270
b. For compound interest
= Principal × (1 + rate of interest)^time period
= $3,000 × (1 + 0.03)3
= $3,000 × 1.03^3
= $3,278.18