Question

Find the amount of the principal when the simple interest rate is 4.345%, the time is 7 months, and the amount of interest earned is $274.00.

Answer 1

tis noteworthy that 7 months is not even a year, since there are 12 months in a year then 7 months is really 7/12 of a year.

`\bf ~~~~~~ \textit{Simple Interest Earned} \\\\ I = Prt\qquad \begin{cases} I=\textit{interest earned}\dotfill & \$274\\ P=\textit{original amount deposited}\\ r=rate\to 4.345\%\to (4.345)/(100)\dotfill &0.04345\\ t=years\dotfill &(7)/(12) \end{cases} \\\\\\ 274 = P(0.04345)\left( \cfrac{7}{12} \right)\implies \cfrac{274}{(0.04345)(7)/(12)}=P\implies 10810.46\approx P`