Question
An investment grows by 8% in the first year, 12% in the
second year, and 10% in the third year. If the initial amount invested is $1,000, what is the final amount after 3 years and the overall percentage increase?Solution
Initial amount = $1,000. Amount after 8% increase = $1,000 × 1.08 = $1,080. Amount after 12% increase = $1,080 × 1.12 = $1,209.60. Amount after 10% increase = $1,209.60 × 1.10 = $1,330.56. Overall percentage increase = ((1,330.56 - 1,000) / 1,000) × 100 = 33.056%. The final amount is $1,330.56 , and the overall percentage increase is 33.056%.
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