Question

Over 20 years, an initial investment grew to $51,892.10. The investment account earned 4% annual interest compounded biannually. No other deposits or withdrawals were made.

What was the amount of the initial investment?

(1 point)
$

Answer 1

Use P = A / (1 + r/2)^{2t}.

P = 51,892.10 / (1.02)^{40} ≈ 51,892.10 / 2.2080396636 ≈ $23,501.43.