The amount A to which a principal P amounts at r% compound interest for n...
MATHEMATICS
JAMB 2015
The amount A to which a principal P amounts at r% compound interest for n years is given by the formula A = P(1 + (r ÷ 100)\(^n\). Find A, if P = 126, r = 4 and n = 2.
- A. N132.50K
- B. N136.30K
- C. N125.40K
- D. N257.42K
Correct Answer: B. N136.30K
Explanation
\( A = P \left(1 + \frac{r}{100}\right)^n \)
Where P = 126, r = 4,n = 2
A=126 \( \left(1 + \frac{4}{100}\right)^2 \text{Using LCM} \)
=126 \( \left(\frac{100+4}{100}\right)^2 = 126 \left(\frac{104}{100}\right)^2 \)
=126 \( \left(1.04^2 \right) \)
= 126 * 1.04 * 1.04
=136.28
A = 136.30 (approx.)
The Amount A, = N136.30k
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