Answer:
Step-by-step explanation:
Any time you have compounding more than once a year (which is annually), unless we are talking about compounding continuously, you will use the formula
[tex]A(t)=P(1+\frac{r}{n})^{(n)(t)}[/tex]
Here's what we have:
The amount after a certain time that she has in the bank is 4672.12; that's A(t).
The interest rate in decimal form is .18; that's r.
The number of times the interest compounds is 12; that's n
and the time that the money is invested is 3.5 years; that's t.
Filling all that into the formula:
[tex]4672.12=P(1+\frac{.18}{12})^{(12)(3.5)}[/tex] Simplifying it down a bit:
[tex]4672.12=P(1.015)^{42}[/tex] Raise 1.015 to the 42nd power to get
4672.12 = P(1.868847115) and divide to get P alone:
P = 2500.00
She invested $2500.00 initially.
