Alfred puts £2355 into an bank account.
The account pays 1%
compound interest each year.

Work out how much Alfred will have in the account after 14 years.

To calculate the amount Alfred will have in his account after 14 years with 1% compound interest per year, we can use the compound interest formula:

\[
A = P \left(1 + \frac{r}{100}\right)^n
\]

Where:
- \( A \) is the amount in the account after \( n \) years,
- \( P \) is the principal amount (initial investment),
- \( r \) is the annual interest rate (as a percentage),
- \( n \) is the number of years.

Plugging in the values:
- \( P = £2355 \)
- \( r = 1\% \)
- \( n = 14 \) years

\[
A = 2355 \left(1 + \frac{1}{100}\right)^{14}
\]
\[
A = 2355 \left(1.01\right)^{14}
\]

Now, let's calculate the value:

\[
A \approx 2355 \times 1.148
\]
\[
A \approx £2704.74
\]

So, after 14 years, Alfred will have approximately **£2704.74** in the account.

Would you like more details or have any questions?

Here are 5 related questions to expand your understanding:
1. What would the amount be after 10 years instead of 14 years?
2. How does the final amount change if the interest rate is increased to 2%?
3. What would the amount be if Alfred deposits an additional £1000 after 7 years?
4. How does the formula change if interest is compounded semi-annually?
5. What is the difference in total interest earned between simple interest and compound interest over 14 years?

**Tip:** Always double-check the interest rate and compounding frequency in financial problems, as these can significantly impact the final amount.

Learn how to calculate compound interest over 14 years with an annual interest rate of 1%. Follow a step-by-step solution using the compound interest formula to determine the amount Alfred will have in his bank account after 14 years. Suitable for high school students studying finance and exponential growth.

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