Solution - Compound interest (basic)

2159.51

2159.51

Step-by-step explanation

Use $A = P {(1 + r / n)}^{(n t)}$ with $P = 1, 601$ , $r = 6 %$ , $n = 12$ , $t = 5$ .

Compute period rate and exponent: $\frac{r}{n} = 0.005$ , $n t = 60$ , so the growth factor is $1.3488501525$ .

Multiply principal by growth factor: $1, 601$ × $1.3488501525$ = $2159.51$ .

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