Question

-When invested at an annual

interest rate of 7% an account
earned $581.00 of simple
interest in one year. How much
money was originally invested in
account

Answer 1

$8300

Explanation:

First, you need to know the formula for this type of question.

The formula is I = Prt. These variables are: I = Interest, P = Principle investment, r = Rate, and t = Time.

Your equation will be 581 = P(0.07)(1), since 0.07*1 is 0.07, you'll earn only 7% interest.

So, we broke down the equation to 581 = P(0.07), and you have to isolate P.

Since you have to isolate P, you divide 0.07 from both sides of the equation, which is 581/0.07 = 8300.

So, your principle investment is $8300.

Good luck!