Question

How much interest is to be paid at 1500 principal, 7% compounded annually, and for 3 years

Answer 1

I = 337.56

Explanation:

Given that,

Principal, P = 1500

Rate, R = 7%

Time, t = 3 years

We need to find the interest if it is compounded annually. We know that, the amount is given by :

`A=P(1+(r)/(100))^n`

Put all the values,

`A=1500* (1+(7)/(100))^3\\\\A=1837.56`

We know that,

Interest = Amount - Principal

I = 1837.56 - 1500

I = 337.56

Hence, the interest is equal to 337.56.