A bank promises to pay 3.5% pa compound interest on deposits of £7691 if saved for 4 years. How much will the savings be worth at the end of the period mentioned? Write your answer correct to 2 decimal places

Solução

A bank p ro mi ses t o p a y 3.5% p a co m p o u n d in t eres t o n d e p os i t s o f £7691 i f s a v e d f or 4 ye a rs . Ho w m u c h w i ll t h e s a v in g s b e w or t h a t t h e e n d o f t h e p er i o d m e n t i o n e d ? W r i t e yo u r an s w er correc t t o 2 d ec ima l pl a ces

Amount : 8825.6

Passos da solução

Translate the problem into an equation:

A = 7691 (1 + \frac{0.035}{1})^{1 \cdot 4}

7691 (1 + \frac{0.035}{1})^{1 \cdot 4} = 8825.59939 \dots

Round to the nearest hundredth:

8825.6

Amount : 8825.6