2000 dinars are invested for 2 years at 10% compound interest per year. What is the amount after 2 years?
Answer and explanation
Correct answer: C. 2420
- Step 1: After year 1: 2000 x 1.1 = 2200.
- Step 2: After year 2: 2200 x 1.1 = 2420.
Answer
2420.
Why not the others: 2400 is simple interest; 400 is only the simple interest earned; 2200 is the amount after one year.
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