Irene invested $27,000 in a twelve-year CD bearing 8.0% interest, but needed to withdraw $6,000 after three years. If the CD's penalty for early withdrawal was eighteen months' worth of interest on the amount withdrawn, when the CD reached maturity, how much less money did Irene earn total than if she had not made her early withdrawal?

Given:

Principal investment: 27,000

term: 12 years

interest rate: 8%

27,000 x 8% x 12 yrs = 25,920 total interest

27,000 + 25,920 = 52,920

After 3 years, needs to withdraw 6,000. Penalty equivalent to 18 months worth of interest on amount withdrawn.

27,000 x 8% x 3 yrs = 6,480 total interest for 3 years.

27,000 + 6,480 = 33,480

Penalty.

6,000 x 8% x 1.5 yrs = 720 penalty for early withdrawal

Balance:

33,480 - 6,000 - 720 = 26,760

Interest for the remaining 9 years

26,760 x 8% x 9 yrs = 19,267.20

Total balance: 26,760 + 19,267.20 = 46,027.20

52,920 - 46,027.20 = 6,892.80 difference in total investment