Question

Algebraically manipulating the formula I = Prt, find the principal (PV) deposited in a savings account which earned $11,000 in interest at a simple interest rate of

9.5% for 15 years to the nearest whole cent).

$7,312.07
$8,083.92
$7.719.30
$6,987.44
None of these choices are correct.

Answer 1

Answer: the required principal value is $7,719.30

Explanation:

Given: Formula to calculate interest : I= Prt, P=principal value, r = rate of interest, t = time.

I = $11,000

r= 9.5% = 0.095

t= 15 years

Substitute in formula, we get

`11000=(P)* (0.095)*(15)\\\\\Righatrrow\ P=(11000)/(0.095*15)\approx\$7719.30`

Hence, the required principal value is $7,719.30