You deposit $1,000 for years at an interest rate of 2.0%.If the interest is compounded guardedly.How much money would you have at the end of four years in this situation?
Principle(P)=$1000 Rate (r)=2%=0.02 Time=t=4 years n=no of times the interest is compounded per year=4 Amount (A)=? Then, A=P{(1+r/n)}^(n×t) =1000{1+0.02/4}^(4×4) =1000×(1.005^16) =1000 × 1.08307115 =1083.07115 =1083.07 (approx)
Thus at the end of 4 years the amount of money will be Rs 1083.070 approximately.
