cole opened a savings account 8 years ago.The account earns a 7%intrest, compounded monthly. if the current balance is 100.00, how much did he deposit initially?

Solution

Solution

Principal : 57.21

Solution steps

Translate the problem into an equation:

100 = P (1 + \frac{0.07}{12})^{12 \cdot 8}

Solve for

P, 100 = P (1 + \frac{0.07}{12})^{12 \cdot 8} : P = 57.21

Principal : 57.21

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