Answer:
=$9,853.70 and $2,653.70
Explanation:
The formula for calculating compound interest is
FV = PV × (1+r)n
where FV = Future Value
PV = Present Value, $7200
r = annual interest rate, 4 % or 0.04
n = number of periods... 8
The compound amount
Fv = 7200 x ( 1+ 0.04 )8
=7200 x 1.3685690
=$9,853.69
=$9,853.70
The interest will be
= $9853.70 - $7,200
= $2,653.70
