as n becomes very large, (1+1/n)^2 approaches =
as n becomes very large (we say it tends to infinity) then1/n becomes very small (we say it tends to zero)
So as n tends to infinity, 1 + 1/n tends to 1 +0 which = 1.
So (1 + 1/n)^2 tends to (1+0)^2 =1^2 =1