Answer:
Principat amount to be invested = P= $ 2,118.64
Equation:
P = A / (1 + rt)
r = R/100 ( where R is the simple interest rate)
r = 4.5%/100 = 0.045 per year
A= amount required after 4 years = $2500
t= time period = 4 years
putting the values in equation
P = 2500 / ( 1 + (0.045 × 4)) = 2118.6440677966
P = $ 2,118.64
The principal investment to get a total amount of $ 2,500 in 4 years is $ 2,118.64.
