Problema Solution
Suppose you just deposited $500 into a bank account that has earned 5% interest on the amount
you initially invested. If the new balance is $1,760, what was your initial investment?
Answer provided by our tutors
Step 1. Let the initial amount invested be $ x.
Step 2. Now, the final balance after investing $500 is $1760.
Step 3. We calculate the balance that existed before we deposited $500 :
$1760 - $500 = $1260
We do this because the interest had applied only on the initail x.
So, when the amount invested was $x, the balance was $1260.
Clearly, $1260 is the (initial deposit) + (5 % of inital deposit)
so, x + (5 % of x) = 1260
x + ((5/100)*x) = 1260
(105/100)*x = 1260
x = 1260 *100 / 105
x = $1200 which is the answer.