Question

Dan invests £7600 into his bank account.

He receives 3% per year compound interest.
How much will Dan have after 4 years?
Give your answer to the nearest penny where appropriate.

Answer 1

£ 8553.8

Explanation:

A = P(1 + r/100)t

P = £7600

r = 3%

t = 4 years

A = 7600(1 + 3/100)⁴

= 7600[(100+3)/100]⁴

= 7600×(103/100)⁴

= 7600×1.03⁴

= 7600×1.1255

= £ 8553.8