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What principle will amount to 1000 if invested at 2% compounded monthly for 10 years?

Solution

What principle will amount to 1000 if invested at 2% compounded monthly for 10 years?

Solution

Principal : 818.87

Solution steps

Translate the problem into an equation:

1000 = P (1 + \frac{0.02}{12})^{12 \cdot 10}

Solve for

P, 1000 = P (1 + \frac{0.02}{12})^{12 \cdot 10} : P = 818.87

Principal : 818.87

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