For the following exercise use the compound interest formula

For the following exercise, use the compound interest formula, A(t) = P 1 + r n nt , where money is measured in dollars. After a certain number of years, the value of an investment account is represented by the expression 10,200 1 + 0.04 12 120 . What was the initial deposit made to the account?

Solution

A(t) = P( 1 + r/ n)^ nt

As per information given in question the RHS of above equation is 10,200 1 + 0.04 12 120

comparing with RHS of equation equation with values:

P 1 + r n nt = 10,200 (1 + 0.04/ 12)^ 120

P1 = $10, 200 ( principal or the intial deposit)

Check if given equations are given in another way