Question

Please help me. I know I’m solving for the principal but need help with the steps

Answer 1

Given: The information below

$\begin{gathered} time(t)=5\text{years} \\ rate(r)=4\%=0.04 \\ Interest(I)=40 \end{gathered}$

To Determine: How much Austine invested

Solution

Please note that the amount invested is the Principal

The formula combining principal, rate, time and interest for simple interest is

$I=\text{Prt}$

Make P the subject of the formula

$P=\frac{I}{rt}$

Substitute for I, r and t given into the formula as shown below

$\begin{gathered} P=\frac{40}{0.04\times5} \\ P=\frac{40}{0.2} \\ P=200 \end{gathered}$

Hence, the amount invested by Austine is $200