Question

3) Mary deposits £10000 in an account which pays 5.6% compound

interest per year.
How much will Mary have in her account after 5 years?

Answer 1

FV= £13,131.66

Explanation:

Giving the following information:

Initial Investment (PV)= £10,000

Interest rate (i)= 5.6%

Number of periods (n)= 5 years

To calculate the future value (FV), we need to use the following formula:

FV= PV*(1 + i)^n

FV= 10,000*(1.056^5)

FV= £13,131.66