posted by Britney .
Bernie invested a sum of money 8 yr ago in a savings account, which has since paid interest at the rate of 3%/year, compounded monthly. His investment is now worth $39,396.92. How much did he originally invest?
P = Po(1+r)^n.
P = $39,396.92.
Po = ?.
r = (3%/12) / 100% = 0.0025 = Monthly %
rate expressed as a decimal.
n = 12Comp/yr * 8yrs = 96 Compounding
P = Po(1.0025)^96 = $39,396.92
Po*1.27087 = 39,396.92
Po = $31,000.00 = Initial deposit.