Question

Lucy invested for 15 years at 2.8%, compounded annually and ended with an account balance of $2250. What was her initial deposit?

Answer 1

Answer:1244

Explanation:

Answer 2

Explanation:

Use the formula for calculating compound interest PN=P0(1+rk)Nk where N is the unknown, PN=2250, k=1, N=15, and r=0.028. Substitute the values into the formula and simplify.

2250=P(1+0.0281)1⋅15

2250=P(1.028)15

2250=P(1.5132...)

1486.91=P

Rounded to the nearest dollar, Lucy's initial deposit was $1487.