Question

7

(a) Olivia deposits $8600 in a bank. The interest rate is 2.6% per annum.
Find the total interest she will earn in 4 years.

Answer 1

Below in bold.

Explanation:

You do not say if the interest is simple or compound.

Simple Interest: I = PRT/100

= (8600* 2.6 * 4)/ 100

= $894.40.

Compound Interest:- amount after 4 years

= 8600(1 + 0.026)^4

= $9529.89

So the compound interest

= 9529.89 - 8600

= $929.89.