Question

Brian invests £1900 into his bank account.
He receives 4.5% per year compound interest.
How much will Brian have after 7 years?
Give your answer to the nearest penny where appropria

Answer 1

Brian have 258564Pennies.appr.

Answer 2

Brian will have $ 2585.637 after 7 years

Solution:

The amount using compound interest is given as:

$A = p(1 + r)^t$

Where,

p is principal and r is rate of interest in decimal and t is number of years

From given,

p = 1900

t = 7

$r = 4.5 \% = \frac{4.5}{100} = 0.045$

Substituting we get,

$A = 1900( 1 + 0.045)^7\\\\A = 1900 \times 1.045^7\\\\A = 1900 \times 1.36086\\\\A = 2585.637$

Thus Brian will have $ 2585.637 after 7 years

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