After five years of earning interest at an annual rate of 4%, an investment has earned $1,200 in interest. determine the amount of the initial investment. show all work for full credit.

The amount of the initial investment is $ 6000.

Step-by-step explanation:

Given: After five years of earning interest at an annual rate of 4%, an investment has earned $1,200 in interest.

We have to find the amount of the initial investment.

We know,

Where P is initial investment

r is rate of interest

t is time period.

Given : Simple interest = $ 1200

Rate = 4 % =0.04

Time = 5 years

Substitute, we get,

Solve for P, we have,

Divide both side by 0.04 × 5  , we have,

Simplify, we get ,

P = $ 6000

Thus, The amount of the initial investment is $ 6000.

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