Answer: $2154.56
Step-by-step explanation:
The formula to calculate the compound amount is given by :-
[tex]A=P(1+r)^t[/tex]
, where P = Principal amount.
r= Rate of interest ( in decimal)
t= Time period. ( usually in years)
Given : The amount that results when $3,000 is compounded at 7% annually over eight years .
i.e. we have
P= $ 3000 , r = 7%=0.07 and t= 8
Then, the compound amount =[tex]A=3000(1+0.07)^8[/tex]
[tex]=3000(1.07)^8=3000(1.71818617983)\\\\=5154.55853949\approx5154.56[/tex]
Hence, Compound amount after 8 years = $5154.56
Now, Interest earned = Compound amount(A) - Principal amount (P)
= $5154.56- $3000 = $2154.56
Hence, the interest earned in this case= $2154.56
