Question

Find the principal which amounts to $918 in 1 year at a simple interest
of 2% per annum

Answer 1

P = $900

Explanation:

Simple Interest Formula:
`A = P(1+rt)`

Where A is the final amount,

P = Principal

r = Interest Rate in Percent or
`(r)/(100)` per annum

t = time in years

From the information given in the question,

A = $918

r = 2% per annum or
`(2)/(100)`

t = 1 year

Lets substitute these values to find P, the principal.

`P(1+((2)/(100) )(1))=918\\P(1+0.02)=918\\1.02P=918\\P = (918)/(1.02) \\=$900`

Therefore, P = $900