Mark borrowed $200 at 12% compound interest for two years. If he makes no payments. How much interest will he owe at the end of the second year?

Amount payable after two years is calculated using the following equation:

A = P (1+r) ^n

Where

A = Amount payable, P=Amount borrowed, r = annual interest, n=number of years

Interest, C = A-P

Substituting

C = 200 (1+0.12) ^2 - 200 = 250.88-200 = $50.88