On the 1st january 2014 carol invested some money in a bank account.
the account pays 2.5% compound interest per year.
on 1st january 2015 carol withdrew £1000 from the account.
on 1st january 2016 she had £23517.60 in the account.
work out how much carol originally invested in the account.

Step-by-step explanation:

The formula for the accrued amount from compound interest is

1. Amount in account on 1 Jan 2015

(a) Data:

a = £23 517.60

r = 2.5 %

n = 1

t = 1 yr

(b) Calculations:  

r = 0.025

The amount that gathered interest was £22 944.00 but, before the interest started accruing, Carol had withdrawn £1000 from the account.

She must have had £23 944 in her account on 1 Jan 2015.

(2) Amount originally invested

(a) Data

A = £23 944.00

3. Summary

1 Jan 2014      P = £23 360.00

1 Jan 2015     A =    23 944.00

     Withdrawal =    -1  000.00

                     P =     22 944.00

1 Jan 2016    A =    £23 517.60

step-by-step explanation: