A person invests 1000 at a 10% annual interest rate, compounded annually. What will be the amount after 2 years?
Q1. A person invests 1000 at a 10% annual interest rate, compounded annually. What will be the amount after 2 years?
Answer: 1210
Explanation: Compound interest formula: A = P(1 + r)^t. Here, P = 1000, r = 10% or 0.1, t = 2. So, A = 1000(1 + 0.1)² = 1210.