Question

If interest is $28.67, time is 1 year, and the rate is 8.32%, what is the principal? (Round to the nearest hundredth place)

a) $250.78
b) $300.45
c) $320.12
d) $280.34

Answer 1

The principal is approximately $345.55.

Step-by-step explanation:

To find the principal, we can rearrange the formula for interest:

Interest = Principal × Rate × Time

Plugging in the given values:

$28.67 = Principal × 0.0832 × 1

To isolate the principal, divide both sides of the equation by (0.0832 × 1):

Principal = $28.67 / (0.0832 × 1)

Simplifying the expression:

Principal ≈ $345.55

Rounding to the nearest hundredth place, the principal is approximately $345.55.