Answer:
(a) Amount owed after 2 years is $ 1081.54
(b) The shark's vig is $ 1031.54
Step-by-step explanation:
(a)
The amount on a principal, P, after a period, T, at a compound interest, R, is given by
[tex]A = P\left(1+\dfrac{R}{100}\right)^T[/tex]
From the question,
P = $ 50
R = 3% per week
T = number of weeks in 2 years = 2 × 52 = 104 (Assuming 52 weeks for each year)
[tex]A = \$\,50\left(1+\dfrac{3}{100}\right)^{104} = \$\,50(1.03)^{104} = \$\,1081.54[/tex]
(b)
The shark's vig = $ 1081.54 - $ 50 = $ 1031.54
