Answer:
$1102.50
Step-by-step explanation:
The appropriate compound interest formula is
A = P(1 + r)^t, where P is the principal ($1000), t is the number of years, and r is the interest rate as a decimal fraction.
Here A = $1000(1 + 0.05)^2 = $1000(1.05)^2 = $1102.50
