Question

If the money and interest are left in the bank, how much is the total savings after three years for $2,000 at 11% annually compounded interest?
A. $348.18
B. $1,390.35
C. $2,735.26
D. $3,200.50

Answer 1

The formula for compound interest is:
\[FV= PV ( 1+r)^n\]
where FV= future value
PV= present value
r= interest ratio (as a decimal)
n= no. of years

Answer 2

\[FV= 2000( 1+ 0.11)^3= 2735.26\]

Answer 3

So your answer is C.