Solution - Compound interest (basic)

2088.01

2088.01

Step-by-step explanation

Use $A = P {(1 + r / n)}^{(n t)}$ with $P = 1, 853$ , $r = 4 %$ , $n = 4$ , $t = 3$ .

Compute period rate and exponent: $\frac{r}{n} = 0.01$ , $n t = 12$ , so the growth factor is $1.1268250301$ .

Multiply principal by growth factor: $1, 853$ × $1.1268250301$ = $2088.01$ .

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