Respuesta :
The compound interest amount after three years will be 2315.35.
Amount = 2000 ( 1+ 5/100)^3
= 2000 (105/100)^3
= 2000 (21/20)^3
= 2315.25
What is compound interest?
Compound interest, also known as interest on principal and interest, is the addition of interest to the loan or deposit principal.
When you receive interest on both the principal amount of your savings and any previous interest, this is known as compound interest. So let's say you put $1,000 (your principal) into an investment that generates 5% once a year in interest or other earnings (the compounding frequency).
Adding the annual interest rate raised by the number of compound periods minus one to the initial principal amount yields compound interest. Next, the value obtained is reduced by the full initial loan amount.
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