Question

John wants to invest in a simple intereset savings account The intereset rate on this account is 0.7%. The account balance y can be modeled by the following linear equation y=150,000+150,000(0.007)x where x represents the time (in years) that john leaves her money in the account what is johns initial investment?

Answer 1

John's initial investment is Rs.150000

Explanation:

Let the principal amount be a

We are given that John wants to invest in a simple interest savings account .The interest rate on this account is 0.7%.

Now to find simple interest in x years

Formula :
`Si = P * T * R`

Where P = Principal

T= time

R = rate of interest in decimals

So,
`SI=a * 0.007 * x`

Amount = Principal+Interest

Amount =
`a+a(0.007)x`

We are given that The account balance y can be modeled by the following linear equation y=150,000+150,000(0.007)x

So, On comparing a = 150000

Hence John's initial investment is Rs.150000