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Urgent

Jasmine invested money at the Bank of America. The account has a 2.5%
annual rate. She earned $575 in interest over a 7 year period. How much money did she originally invest?

User LImbus
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1 Answer

5 votes

$482.11 in interest

Use the compound amount formula. Calculate the compound amount and then subtract the principle to find the amount of interest earned.

A = P(1 + r)^t, where r is the interest rate as a decimal fraction

This becomes:

A = $575(1 + 0.07)^9, or A = $1057.11.

Subtracting the principal: A - P: $1057.11 - $575 = $402.11

User Mellet
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