Question

8. Reece made a deposit into an account that earns 8% simple interest. After 8 years, Reece had earned $400. How much was Reece's initial deposit?

Answer 1

$\begin{gathered} P\cdot r\cdot t=I \\ r=0.08 \\ t=8 \\ I=400 \\ \text{from the first equation one has} \\ P=\frac{I}{r\cdot t} \\ \text{hence} \\ P=\frac{400}{0.08\cdot8} \\ P=\frac{400}{0.64} \\ P=625 \end{gathered}$