Salma
invested a certain amount of money in a bank which gives an interest rate of
10% compounded annually. How much did she invest at the start if she got 5000
sh at the end of 2 years?
solution
n=2, t=1,
R=10%, A2=5000, P=?
An
= P(1 + RT/100)n
A2
= P(1 + (10x1)/100)2
A2
= P(1 + 10/100)2
A2
= P(100/100 + 10/100)2
A2
= P(110/100)2 But
A2=5000,
5000 =
P(1.1)2
5000 = 1.21P
5000 = 1.21P
1.21 1.21
5000 = P
1.21
P = 4132.23 (to
2 d.p.)
Hence at the start she invested Tsh 4132.23
TRY THIS……….
Salome
invested a certain amount of money in a bank which gives an interest rate of 5%
compounded annually. How much did she invest at the start if she got 12,000 sh
at the end of 2 years?
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