Vivian opened a savings account 5 years ago. The account earns 10% interest, compounded quarterly. If the current balance is 300.00, how much did she deposit initially?

Solution

Solution

Principal : 183.08

Solution steps

Translate the problem into an equation:

300 = P (1 + \frac{0.1}{4})^{4 \cdot 5}

Solve for

P, 300 = P (1 + \frac{0.1}{4})^{4 \cdot 5} : P = 183.08

Principal : 183.08

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