For a loan of $2,000 with a 4% annual interest rate compounded annually for 3 years, what is the amount of interest?*$249.73$250$249.60$240

To calculate the amount of interest for a loan compounded annually, you can use the formula for compound interest which is A = P(1 + r/n)^(nt).

Here, P = principal amount (the initial amount of money) = $2000 r = annual interest rate (in decimal) = 4/100 = 0.04 n = number of times that interest is compounded per year = 1 (since it's compounded annually) t = the time the money is invested for in years = 3

Substitute these values into the formula:

A = 2000(1 + 0.04/1)^(1*3) A = 2000(1 + 0.04)^3 A = 2000 * 1.04^3 A = 2000 * 1.124864 A = $2249.73

The total amount after 3 years is $2249.73.

To find the interest, subtract the initial principal from the total amount:

Interest = A - P Interest = $2249.73 -$2000 Interest = $249.73

So, the amount of interest for a loan of $2000 with a 4$249.73. Therefore, the correct answer is $249.73.