Question 227845
I need both formulas
(1) {{{A[1] = P*(1 + t*r)}}}
and
(2) {{{A[2] = P*(1 + r)^t}}}
given:
{{{A[2] - A[1] = 61}}} dollars
{{{r = .05}}}
{{{t = 3}}}
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Subtract (1) from (2)
(2) {{{A[2] = P*(1 + r)^t}}}
(1) {{{A[1] = P*(1 + t*r)}}}
{{{A[2] - A[1] = P*((1 + .05)^3 - (1 + 3*.05))}}}
{{{61 = P*(1.05^3 - 1.15)}}}
{{{61 = P*(1.157625 - 1.15)}}}
{{{61 = .07625P}}}
{{{P = 8000}}}
The principle is $8000
check:
(1) {{{A[1] = P*(1 + t*r)}}}
{{{A[1] = 8000*(1 + .15)}}}
{{{A[1] = 9200}}}
and
(2) {{{A[2] = P*(1 + r)^t}}}
 (2) {{{A[2] = 8000*(1.05)^3}}}
{{{A[2] = 8000*1.157625}}}
{{{A[2] = 9261}}}
{{{A[2] - A[1] = 9261 - 9200}}}
{{{A[2] - A[1] = 61}}}
OK