Question

Do not round any intermediate computations, and round your answers to the nearest cent.

Answer 1

Given that the rate of interest = r = 5%, time = t = 3 years,

and amount to be made = A = $3000.

And we need to find the principal amount (P).

Then, the formula is

`A=P(1+(r)/(100))^t`

Substituting the values we have

`\begin{gathered} 3000=P(1+(5)/(100))^3 \\ 3000=P(1+(1)/(20))^3 \\ 3000=P((21)/(20))^3 \\ 3000=P*(21)/(20)*(21)/(20)*(21)/(20) \\ P=(3000*20*20*20)/(21*21*21)=2591.51 \end{gathered}`

Hence, the money to be invested will be $2591.51