Answered

A bank deposit paying simple interest at the rate of 8%/year grew to $1600 in 10 months. Find the principal. (Round your answer to the nearest cent.) $

Answer :

Answer:

$1500

Explanation:

The simple interest I is an amount earned when a principal P is invested at a fixed rate R for a given time T given by the formula

I = PRT/100

The interest is also the difference between the Amount A and the principal.

Given that a bank deposit paying simple interest at the rate of 8%/year grew to $1600 in 10 months

1600 - P = P(8)(10/12)/100

160000 - 100P = 20P/3

480000 - 300P = 20P

320P = 480000

P = $1500

The principal is $1500.

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