Answer :
Answer:
To find the compound interest, we can use the formula:
A = P (1 + r/n)^(nt)
where:
A = final amount
P = principal amount (initial investment) = 20,000
r = annual interest rate = 10% = 0.1
n = number of times interest is compounded per year = 1 (annually)
t = time in years = 6 years
First, let's calculate the final amount (A):
A = 20,000 (1 + 0.1/1)^(1*6)
A = 20,000 (1.1)^6
A = 20,000 x 1.7715
A = 35,430
Now, let's find the compound interest:
Compound interest = A - P
= 35,430 - 20,000
= 15,430
So, the compound interest on 20,000 for 6 years at 10% per annum compounded annually is 15,430.
Let me know if you have any further questions!