Question

Last question (I think) I asking today
How much interest is earned for the investment?
$20,000 for 2 years at 6% compounded annually

Answer 1

Rosario Vampire is awesome

Answer 2

try 20000* 1.06^2 for the total amount
subtract 20000 to get only the interest.

Answer 3

@phi
I don't get it. Explain please I a little confuse.

Answer 4

you could work it out like this:
how much interest do you get from 6% for 1 year ?

20000* 0.06 = amount of interest after one year

compounded yearly means,
add that interest to the 20000 and get interest on the amount

interest on the 2nd year is
(20000+ 20000*0.06)*0.06

Answer 5

first year is 21200 right?

Answer 6

@phi
so I think the second year is 43672?

Answer 7

the total interest for the 2 years is
20000* 0.06 + (20000+ 20000*0.06)*0.06

the interest for the 1st year is 1200

Answer 8

not sure how you got such a big number for the 2nd year?

Answer 9

@phi
when it comes to math I suck real bad :'(

Answer 10

a lot of math is thinking... so I hope that is not true.

Answer 11

@phi
so if the first year is 1200
then the second years interest is 2400.
I don't know anymore *flip table*

Answer 12

*without* compounding, the interest you get for the 2nd year is also 1200
and the total for the two years is 2400 (1200 for each year)

Answer 13

*with compounding*, the first year you get 1200 of interest (from 0.06*20000)

now you have 20000+1200 in the account= 21200

now figure out the interest you get on 21200 (at 6% ) for the 2nd year
what do you get ?

Answer 14

@phi
I end up getting 1272 for 6% interest

Answer 15

so 1272 is the interest you get for the 2nd year
the total interest you get for the 2 years is 1200 from the 1st year
plus 1272 for the 2nd year

Answer 16

@phi
= 2472

Answer 17

yes

Answer 18

@phi
thank you so much
I couldn't do this without you!

Answer 19

yw