The formula for calculating the amount of money after compounding for a period of time is expressed as;
A = P(1+r/n)^nt
P is the principal (amount deposited)
r is the rate
t is the time
n is the time of compounding
Given
P = 200.00
r = 9% = 0.09
t = 2 years
n = 1 year
Substitute the given parameters into the formula
A = 200(1+0.09/1)^1(2)
A = 200(1.09)^2
A = 200(1.1881)
A = 237.62
Hence he will be able to spend 237.62 on the bike
