ami would like to withdraw $10,364.10 at the end of each year, for 10 years, from an account paying 2.3% compounded annually. Determine the amount needed in the account for Tami to do this. Round to the nearest cent.

Answer = $3,140.64


EXPLANATION

Given,

Amount, A = 10,364.10
Rate, r = 2.3
Number of times interest is compounded per year, n = 1
Time (in years), t = 1
Principal, P = ?

Formula: A = P [tex](1 + \frac{r}{n} )^{nt} [/tex]

10,364.10 = P [tex]( 1 + \frac{2.3}{1} )^{1} [/tex]

10,364.10 = P + 2.3P

10,364.10 = 3.3P

P = [tex] \frac{10,364.10}{3.3} [/tex]

P = 3,140.64 (Rounded off to the nearest cent)