Question

Cynthia invests some money in a bank which pays
5% compound interest per year.
She wants it to be worth over £8000 at the end of 3 years.
What is the smallest amount, to the nearest pound, she can invest?

Answer 1

Let ,Cynthia invested $x

Rate = 5%per year

time = 3 year

Amount

A= P(1+r/100)^t

8000=x(1+5/100)^3

8000=x(21/20)^3

x= (8000x8000)/9261

x=6910.7$

Therefore she can invest =$6910.7 =5322.14 pound