Question

Amy makes an initial investment of $5000. The investment loses 13.5% each year. What will the amount of Amy's investment be in 5 years? A. $9,417.80 B.$2,952.45 C. $2,492.10 D. $2,421.31

Answer 1

the principal is P = 5000$

rate r = 13.5 %

time t = 5 years

the Amount after 5 years will be

`A=P(1-(r)/(100))^t`
`A=5000(1-(13.5)/(100))^5`
`A=5000*((86.5)/(100))^5`
`A=5000*0.4842`

A = 2421.31 $

thus the answer is option D