Anthony invested a sum of money 2 years ago in a savings account that has since paid interest at the rate of 5%/year compounded quarterly. His investment is now worth $24,289.11. How much did he originally invest? (Round your answer to the nearest cent.)
Expert Answer
Amount Originally Invested | 21,991.30 |
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Statementshowing Computations | |
Paticulars | Amount |
Time period in Years | 2.00 |
Time period in Quarter = 2*4 | 8.00 |
Interest rate = 5%/4 | 1.25% |
Amount, A | 24,289.11 |
Originally Invest | P |
A = P(1+r/100)^n | |
24,289.11 = P(1+1.25/100)^8 | |
24,289.11 = P(1.0125)^8 | |
24,289.11 = P*1.104486 | |
Principal = 24,289.11/1.104486 | 21,991.32 |