Question #8557b

1 Answer
EZ as pi
Jul 2, 2016

Interest, I = $5033.31 - $4650 = $383.31

Explanation:

The formula to calculate compound interest is:

A = P(1 + R/100)^n" or " A = P(1 + r)^nthe Principal

Where A is the total Amount, including all interest
P = the Principal (invested amount)
R = Rate of interest as a percentage
r = percentage as a decimal
n = time in years.

To find the amount of interest earned I = A-P

A = 4650(1+0.02)^4 " or "A = 4650(1+2/100)^4

A = $5033.31

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