Suppose that an investment of R8000 earns interest at a rate of 15% compounded per year. How much interest will the investment earn after 30 years?
To calculate the interest earned after 30 years, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = final amount
P = principal amount (R8000)
r = annual interest rate (15% or 0.15)
n = number of times interest is compounded per year (1, as it is compounded annually)
t = number of years (30)
Plugging in the values, we get:
A = R8000(1 + 0.15/1)^(1*30)
A = R8000(1.15)^30
A = R8000(46.389)
A = R371112
Therefore, the investment will earn R371112 - R8000 = R363112 after 30 years.