Rohan invested £3000 for 4 years in a savings account. He was paid 2.5% per annum compund interest. How much did Rohan have in his savings account for 4 years?

Answer: Rohan will have £3311 in his savings account for 4 years

Step-by-step explanation:

We would apply the formula for determining compound interest which is expressed as

A = P (1+r/n) ^nt

Where

A = total amount in the account at the end of t years

r represents the interest rate.

n represents the periodic interval at which it was compounded.

P represents the principal or initial amount deposited

From the information given,

P = 3000

r = 2.5% = 2.5/100 = 0.025

n = 1 because it was compounded once in a year.

t = 4 years

Therefore,.

A = 3000 (1+0.025/1) ^1 * 4

A = 3000 (1.025) ^4

A = £3311