Solution - Compound interest (basic)

3047.28

3047.28

Step-by-step explanation

Use $A = P {(1 + r / n)}^{(n t)}$ with $P = 1, 128$ , $r = 5 %$ , $n = 4$ , $t = 20$ .

Compute period rate and exponent: $\frac{r}{n} = 0.0125$ , $n t = 80$ , so the growth factor is $2.7014849408$ .

Multiply principal by growth factor: $1, 128$ × $2.7014849408$ = $3047.28$ .

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Compound interest appears in savings, loans, and investments. Understanding it builds strong financial literacy.