#### Explanation:

Because the time is only one year, it does not matter whether we use compound or single interest.

$I = \frac{P \times R \times T}{100}$

$420 = \frac{P \times 7 \times 1}{100} \text{ } \leftarrow$ solve for $I$

$420 \times 100 = 7 P$

$P = \frac{420 \times 100}{7}$

P = \$6000