Answer: Kim should deposit $3102
Step-by-step explanation:
We would apply the formula for determining compound interest which is expressed as
A = P(1+r/n)^nt
Where
A = total amount in the account at the end of t years
r represents the interest rate.
n represents the periodic interval at which it was compounded.
P represents the principal or initial amount deposited
From the information given,
A = $5000
r = 12% = 12/100 = 0.12
n = 12 because it was compounded 12 times in a year.
t = 4 years
Therefore,
5000 = P(1+0.12/12)^12 × 4
5000 = P(1+0.01)^48
5000 = P(1.01)^48
5000 = 1.612P
P = 5000/1.612
P = $3102
