SOLUTION: How much money must Andrea invest for two years in an account that earns an annual simple interest rate of 8% if she wants to earn $800 from the investment?
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Question 1116989: How much money must Andrea invest for two years in an account that earns an annual simple interest rate of 8% if she wants to earn $800 from the investment? Found 2 solutions by stanbon, ikleyn:Answer by stanbon(75887) (Show Source):
You can put this solution on YOUR website! How much money must Andrea invest for two years in an account that earns an annual simple interest rate of 8% if she wants to earn $800 from the investment?
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A(t) = P(1+rt)
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Solve::
800 = P(1+0.08*2)
P = 800/(1.16)
P = $689.66
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Cheers,
Stan H.
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Interest earned in two years = P*0.08*2,
where P is the original/initial invested amount.
So you have this equation 800 = P*0.08*2, which implies
P = = 5000.
Answer. Andrea must invest 5000 dollars to get her goal.
Be aware : The answer given by @Stan is heavily wrong.
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