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After 88 years, Amanda's account earned $1500$⁢1500 in interest. If the interest rate (in decimal form) is 0.080.08, how much did Amanda initially invest?Amanda's Bank StatementInterest Earned $1500$⁢1500Rate 0.080.08Time 88 YearsPrincipal Invested ?Step 1 of 3: Choose the correct formula:

Question

After 88 years, Amanda's account earned 15001500⁢1500 in interest. If the interest rate (in decimal form) is 0.080.08, how much did Amanda initially invest?Amanda's Bank StatementInterest Earned 15001500⁢1500Rate 0.080.08Time 88 YearsPrincipal Invested ?Step 1 of 3: Choose the correct formula:

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Solution

The formula we need to use is the simple interest formula, which is:

I = PRT

where: I = Interest earned P = Principal amount (initial investment) R = Rate of interest T = Time

Step 2 of 3: Substitute the given values into the formula:

$1500 = P * 0.08 * 88

Step 3 of 3: Solve for P:

P = $1500 / (0.08 * 88)

Calculate the value of P to find out how much Amanda initially invested.

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