Answer: the initial investment is $23556.
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 = $26500
r = 4% = 4/100 = 0.04
n = 1 because it was compounded once in a year.
t = 3 years
Therefore,.
26500 = P(1+0.04/1)^1 × 3
26500 = P(1.04)^3
26500 = 1.125P
P = 26500/1.125
P = $23556
