Question

Colin invests £4600 into his bank account.
He receives 4% per year compound interest.
How much will Colin have after 7 years?
Give your answer to the nearest penny where appropriate

Answer 1

Answer:

£1288

Step-by-step explanation:

This problem is quite simple. Once you learn how to do it and master it, all of these types of problems will be easy. First, let's sort everything.

% = 4

W/Whole = 4600

Part (Answer) = X (Variable)

A simple way to solve these types of problems is to do what I did above. Find the percentage, write it. Find the whole write it. Find the part write it. If you're trying to find the percent write X, if you're trying to find the part write x. In our case, we're trying to find the part. First what you do is, write what I do below. I can write like an underline, so when doing it write P over W. Like a line below the P. Always write this when solving these types of problems.

P =

W =

Second, P (part/percent) = 4. When doing these problems the second step is really easy. Just write the percent over 100. Or if your trying to find the percent do X over 100.

P = 4 =

W = 100 =

Third. 4 = X. 100 = 4600. When finishing the second step next to the percent is the part. In our case it's X. If you already know the part then write down the number. Next to 100 is the whole. Our whole is 4600.

P = 4 = X

W = 100 = 4600

The next step is quite difficult. But if you learn how to do it, it becomes muscle memory. We're going to use cross products. Since X is diagonal from 100, we do 100x. 4 is diagonal from 4600 so we do 4*4600 and that would be what we put. So we do.

100x = 18400(4*4600)

Next we divide by 100.

100x = 18400(4*4600)

100x divided by 100 = X

18400 divided by 100 = 184

So your answer would be X = 184. Or £184.