SOLUTION: please help me ............. raising an amount 4 times by 25% results in 500.what was the original amount.. solve it by compound interest formula.....

Question 935624: please help me .............
raising an amount 4 times by 25% results in 500.what was the original amount..
solve it by compound interest formula.....
Found 2 solutions by Fombitz, Theo:
Answer by Fombitz(32388) (Show Source): You can put this solution on YOUR website!

Answer by Theo(13342) (Show Source): You can put this solution on YOUR website!
let x = the amount.
raising it by 25% means that you are adding 25% of x to x.
25% of x is equal to .25 * x.
you get:
x + 25% of x is equal to x + .25 * x which is equal to 1.25 * x.

raising x by 25% of x is the same thing as multiplying x by 1.25.

if you do that 4 times, then you are multiplying x by 1.25 four times.

you get:

x * 1.25 * 1.25 * 1.25 * 1.25

since 1.25 * 1.25 * 1.25 * 1.25 is equal to (1.25)^4, then that expression becomes:

x * 1.25^4

now you have that x * 1.25^4 = 500

divide both sides of this equation by 1.25^4 and you get:

x = 500 / 1.25^4

you can use your calculator to find that x must be equal to 204.8

multiply 204.8 * 1.25^4 and you will get 500

to confirm for yourself that this is the same as 204.8 * 1.25 * 1.25 * 1.25 * 1.25, then do that in your calculator and you will still get 500.

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