Question

Find principle amount that will grow to $25,000 if interest is 3.2% compounded monthly for 3 years?

Answer 1

$22745 for the initial principal

Explanation:

For compound interest for 3 years

P (principal) x (1 + r (interest rate))³ = 25000

P = 25000 / (1 + 0.032)³ = 22745

Answer 2

$260,416

Explanation:

$25,000/(0.032*3)= $260,416