Montraie is going to invest in an account paying an interest rate of 4.6% compounded annually. How much would Montraie need to invest, to the nearest ten dollars, for the value of the account to reach 1,610 in 15 years?

Solution

Montraie is going to invest in an account paying an interest rate of 4.6% compounded annually. How much would Montraie need to invest, to the nearest ten dollars, for the value of the account to reach 1, 610 in 15 years?

Solution

Principal : 820.07

Solution steps

Translate the problem into an equation:

1610 = P (1 + \frac{0.046}{1})^{1 \cdot 15}

Solve for

P, 1610 = P (1 + \frac{0.046}{1})^{1 \cdot 15} : P = 820.07

Principal : 820.07

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