SOLUTION: Graduation is 3 years away and you want to have $1400 available for a trip. If your bank is offering a 3-year CD (certificate of deposit) paying 2.7% simple interest, how much do y

Algebra ->  Customizable Word Problem Solvers  -> Finance -> SOLUTION: Graduation is 3 years away and you want to have $1400 available for a trip. If your bank is offering a 3-year CD (certificate of deposit) paying 2.7% simple interest, how much do y      Log On

Ad: Over 600 Algebra Word Problems at edhelper.com


    

Question 1126202: Graduation is 3 years away and you want to have $1400 available for a trip. If your bank is offering a 3-year CD (certificate of deposit) paying 2.7% simple interest, how much do you need to put in this CD to have the money for your trip?
Answer by josmiceli(19441) About Me  (Show Source):
You can put this solution on YOUR website!
+I+=+P%2Ar%2At+
+r+=+.027+
+t+=+3+
After 3 yrs you want:
+I+%2B+P+=+1400+
+I+=+1400+-+P+
---------------------
+1400+-+P+=+P%2A.027%2A3+
+1400+-+P+=+.081P+
+1.081P+=+1400+
+P+=+1295.1+
you need to put $1,295.10 in CD
-------------
check:
+I+=+1295.1%2A.027%2A3+
+I+=+104.90+
and
+I+%2B+P+=+104.9+%2B+1295.1+
+I+%2B+P+=+1400+
OK