The formula for the future value V (in dollars) of an investment earning simple interest is V=p+prt, where p (in dollars) is the principal, r is the annual interest rate (in decimal form) and tt is the time (in years).

a. Solve the formula for p.

p=

b. An investment earns 8% simple interest. What amount of principal is needed to have $6000 after 7 years? Round your answer to the nearest cent.

Amount of principal: $

Question

19 December, 06:01

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Answers (1)

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Kelvin Pacheco · Answer 1

A) V = P + PRT

V=P (1+RT)

P=A / (1+RT)

P = 6000 / (1 +.08 X 7)

P = 6000 / 1.56

P = $3,846.15