Answer:
P = $2,431.73
Step-by-step explanation:
The compound interest formula is given by:
[tex]A = P(1 + \frac{r}{n})^{nt}[/tex]
Where A is the amount of money, P is the principal(the initial sum of money), r is the interest rate(as a decimal value), n is the number of times that interest is compounded per unit t and t is the time the money is invested or borrowed for.
In this exercise, we have:
A = 3,184.41
r = 0.03
n = 12(t is measured in years, and the money is compounded monthly)
t = 9
We want to know P
[tex]P = \frac{A}{(1 + \frac{r}{n})^{nt}}[/tex]
[tex]P = \frac{3,184.41}{(1 + \frac{0.03}{12})^{12*9}}[/tex]
[tex]P = \frac{3,184.41}{(1 + 0.0025)^108}[/tex]
[tex]P = \frac{3,184.41}{1.31}[/tex]
[tex]P = $2,431.73[/tex]
