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Simple Interest, SMB-019

A sum of money is invested in an account paying simple interest at a rate of 5.0% per annum.

No withdrawals or deposits are made into the account and over 3 years, with the total interest earned on the investment being $120.

Calculate the sum of money originally invested. (2 marks)

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`$800`

Show Worked Solution

`I = 120, \ \ r = 5/100, \ \ n = 3`

`I` `= Prn`
`120` `= P xx 5/100 xx 3`
`P`  `= 120/0.15`
  `= $800`

Filed Under: Simple Interest Tagged With: num-title-ct-corea, smc-4332-30-Find principal

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