Tucker opened a savings account 4 years ago. The account earns 1% interest, compounded annually. If the current balance is 800.00, how much did he deposit initially?

Solution

Solution

Principal : 768.78

Solution steps

Translate the problem into an equation:

800 = P (1 + \frac{0.01}{1})^{1 \cdot 4}

Solve for

P, 800 = P (1 + \frac{0.01}{1})^{1 \cdot 4} : P = 768.78

Principal : 768.78

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