Haley opened a savings account 1 year ago. The account earns 13% interest, compounded continuously. If the current balance is 5,000.00, how much did she deposit initially?

Solution

Haley opened a savings account 1 year ago. The account earns 13% interest, compounded continuously. If the current balance is 5, 000.00, how much did she deposit initially?

Solution

Principal : 4390.48

Solution steps

Translate the problem into an equation:

5000 = P e^{0.13 \cdot 1}

Solve for

P, 5000 = P e^{0.13 \cdot 1} : P = 4390.48

Principal : 4390.48

Popular Examples

The sum of two numbers is 49 . The larger number is 15 more than the smaller number. What are the numbers?Larger number: Smaller number:Each side of a cube is 22.9 yards long. What is the volume of the cube?The sum of two consecutive odd integers is 52.You deposit 70 in an investment account that earns 6% annual interest compounded quarterly.What is the balance of the account after 5 years?An older model smart phone was marked down by 15% from its original price of 1.99. Find the reduced price of the old model.