To solve this problem, we need to use the formula for compound interest which is:

A = P(1 + r/n)^(nt)

Where:
A = the amount of money accumulated after n years, including interest.
P = the principal amount (the initial amount of money)
r = annual interest rate (in decimal)
n = number of times that interest is compounded per year
t = time the money is invested for in years

In this case, we know that A = $8,000, r = 6% or 0.06 (in decimal), n = 1 (since the interest is compounded annually), and t = 3 years. We need to find P.

So, we can rearrange the formula to solve for P:

P = A / (1 + r/n)^(nt)

Substituting the given values:

P = 8000 / (1 + 0.06/1)^(1*3)
P = 8000 / (1.06)^3
P = 8000 / 1.191016
P = $6719.44

So, the principal amount was approximately $6720. Therefore, the closest answer is a. $6720.

Question

To solve this problem, we need to use the formula for compound interest which is:

A = P(1 + r/n)^(nt)

Where:
A = the amount of money accumulated after n years, including interest.
P = the principal amount (the initial amount of money)
r = annual interest rate (in decimal)
n = number of times that interest is compounded per year
t = time the money is invested for in years

In this case, we know that A = $8,000, r = 6% or 0.06 (in decimal), n = 1 (since the interest is compounded annually), and t = 3 years. We need to find P.

So, we can rearrange the formula to solve for P:

P = A / (1 + r/n)^(nt)

Substituting the given values:

P = 8000 / (1 + 0.06/1)^(1*3)
P = 8000 / (1.06)^3
P = 8000 / 1.191016
P = $6719.44

So, the principal amount was approximately $6720. Therefore, the closest answer is a. $6720.

Knowee AI · Accepted Answer

To solve this problem, we need to use the formula for compound interest which is:

A = P(1 + r/n)^(nt)

Where:
A = the amount of money accumulated after n years, including interest.
P = the principal amount (the initial amount of money)
r = annual interest rate (in decimal)
n = number of times that interest is compounded per year
t = time the money is invested for in years

In this case, we know that A = $8,000, r = 6% or 0.06 (in decimal), n = 1 (since the interest is compounded annually), and t = 3 years. We need to find P.

So, we can rearrange the formula to solve for P:

P = A / (1 + r/n)^(nt)

Substituting the given values:

P = 8000 / (1 + 0.06/1)^(1*3)
P = 8000 / (1.06)^3
P = 8000 / 1.191016
P = $6719.44

So, the principal amount was approximately $6720. Therefore, the closest answer is a. $6720.

The total amount accumulated in an account after 3 years is $8,000. The interest was compounded annually at a rate of 6%. What was the principal amount approximately?Question 12Answera.$6,720b.$6000c.$5550d.$6800

Question

Solution

Similar Questions

Upgrade your grade with Knowee