to the nearest dollar, how much did the company add to the scholarship fund in the first year?

Question

a company is starting a scholarship fund for it's employees. the company will add to the fund on a yearly basis. each year, it will increase the amount added to the fund the previous year by 10%. the amount in the scholarship fund after 4 years is $2,552.55. to the nearest dollar, how much did the company add to the scholarship fund in the first year?

Answer 1

B₄ = P₁ + P₁(1.1) + P₁(1.1)² + P₁(1.1)³  or  B_n = ∑ P₁(1.1)^n-1 as n = 1→n  

 

where B is the balance and P is the payment into the account    

 

2552.55 = 4.641*P₁

 

P₁ = $550