A server is expected to process 2,000 transactions per second during its initial year of deployment. If it is expected to increase transaction growth by 10% annually, how many transactions per second should the server be able to process by the end of its fifth year?

This is like a compound interest problem,

Here, p=2000

r=10%

t=5

Transaction after 5 years = 2000 (1+10/100) ^5 = 3221.02 per second

Explanation:

This is as explained above a compound interest type of question. And the number of transaction per second after 5 years is equal to 3221. Remember, you need to understand the difference between compound interest and simple interest. In first one, we have new p after each year. However, in Simple interest, the p remains the same as the first one.