Answer: £23,360
Step-by-step explanation:
You can use algebra to solve this.
Assume that the original investment is x.
In the beginning of 2015 the balance had increased by 2.5% which is denoted as:
= 1.025x
Carol then withdrew a thousand:
= 1.025x - 1,000
This value then increased by 2.5% again by the beginning of 2016:
= 1.025 * (1.025x - 1,000)
Relevant expression therefore is:
1.025 *(1.025x - 1,000) = 23,517.60
1.025x - 1,000 = 23,517.60/1.025
1.025x = 22,944 + 1,000
x = 23,944/1.025
x = £23,360
