# Compond interest word problem

1. Sep 30, 2008

### Makman

1. The problem statement, all variables and given/known data
If the total interest earned on an investment at 8.2% compounded semiannually for 8.5 years was $1,175.98, what was the original investment? 2. Relevant equations A=P(1+i)^n 3. The attempt at a solution 2. Sep 30, 2008 ### statdad You need to show a little work. To get started, make a list of all the quantities (P, A, i, and n) you are given in the problem; that will show you which you need to find (and may guide you to the solution process to boot) 3. Sep 30, 2008 ### Makman Thank you Statdad! This is what I had: n = 17 i= 0.041 P= P +$1,175.98
Am I on the right track. If I am I come out with this awkward looking formula:
P+$1,175.98 = P(1+i)^n If this is correct then what? Many thanks 4. Sep 30, 2008 ### statdad Great! Yes, your final line $$P + 1175.98 = P(1.041)^{17}$$ is good. If you think about this, it is simply a linear equation with $$P$$ as the variable. All you need to do is rearrange terms and solve for $$P$$. What do you find? 5. Sep 30, 2008 ### statdad Great! Yes, your final line $$P + 1175.98 = P(1.041)^{17}$$ is good. If you think about this, it is simply a linear equation with $$P$$ as the variable. All you need to do is rearrange terms and solve for $$P$$. What do you find? 6. Sep 30, 2008 ### Makman YES! Got it. Simple algebraic manipulation. Answer is$1,200.

Thank you very much!