Question

Matthew invested $2,000 in a compound interest account for 3 years. The interest rate was 5%. How much money would it be in the end of third year in Mattew's account?

Answer 1

$2,315.25

Explanation:

2000 x 0.05 = 100

2000 + 100 = 2100

After year one: 2100

2100 x 0.05 = 105

2100 + 105 = 2205

After year two: 2205

2205 x 0.05 = 110.25

2205 + 110.25 = 2315.25

After year three: 2315.25