I = PRT: Jorge wants to save money for daughter's college ed

Jorge wants to save money for his daughter's college education. If Jorge needs to have $28,288 at the end of 4 years, how much money would he need to invest at a 9% simple interest rate?

I know the variation equations to find the other information for example...
P= I/RT
R= I/PT
T=I/PR

but which would I use for this problem?
P = I/RT?

P= I/.09(4) but how do I know how much intrest was paid aside from the actual investment?

Thanks!

Re: I = PRT

It seems to me you are leaving out one important formula. That is the formula for finding the total "amount" he would have after the stipulated period of time. I am thinking the total amount he will have will be the amount (principal) that he invested plus the amount of interest that was earned over that period of time.
Let us know how you are proceeding.
Your answer will just happen to be a nice round number...a multiple of 100.

Re: I = PRT

ok so 28,288 = P + I
-I -I
28288 - I = P

so then would I set it up P = 28288 - I
then I can't use I = PRT
I = (28288 - I)(.09)(4)

but that would give me... I = 10183.68 - .36I
but that doesn't work... even if I subtract .36I from the whole I ....
.64I = 10183.68 and then divide by .64,
I get 15912.... which makes no sense.....
please let me know where I went wrong...

Re: I = PRT

A = P + I
But I = PRT
Therefore A = P + PRT = P(1 + RT)
A=28,288
R=.09
T=4
Go for it.

Re: I = PRT

Princezz3286 said:

Jorge wants to save money for his daughter's college education. If Jorge needs to have $28,288 at the end of 4 years, how much money would he need to invest at a 9% simple interest rate?

Click to expand...

I can't imagine that he would not want his deposit to grow at compound interest.

S = P(1 + i)n
S = 28,288
i = .09
n = 4

28,288 = P(1.09)^4 making P = $20,040

Thus, an investment of $20,040 would accumulate $8,248 in compounded interest over 4 years.

The simple interest deposit would derive from P + 4(.09P) = 28,288 yielding P = $20,800.

Re: I = PRT

The problem says "SIMPLE" interest.

A=28,288
R=.09
T=4
A = P + I
But I = PRT
Therefore A = P + PRT = P(1 + RT)
28288=P(1+0.09(4))
28288=1.36P
P=28288/1.36=$20,800

Answer: He needs to start with $20,800.

Case closed.