Question

Darryl made a deposit into an account that earns 7% annual compound interest. After 36 months, the value of his account was $1,024.29. What was the approximate amount of Darryl's initial deposit?

Answer 1

$836.

Explanation:

36 months = 3 years.

1024.29 = P (1 + 0.07)^3 where P is the initial deposit.

P = 1024.29 / (1.07)^3

= $836.