Question

For the following problem, how would you set up the equations for the following problem: You invest $15,000 in two funds paying 5% and 6% annual interest. At the end of the year, the total interest from these investments was $837. How much was invested at each rate?

Answer 1

To solve this problem, we can set up an equation using the concept of simple interest. We can then solve the equation to find the amounts invested at each rate.

Step-by-step explanation:

To solve this problem, we can use the concept of simple interest. Let's denote the amount invested at 5% as x, and the amount invested at 6% as 15000 - x (since the total investment is $15,000). The interest earned from the x amount is given by x * 0.05 (since 5% = 0.05), and the interest earned from the 15000 - x amount is (15000 - x) * 0.06 (since 6% = 0.06).

We are given that the total interest earned is $837. Therefore, we can set up the equation: x * 0.05 + (15000 - x) * 0.06 = 837.

Simplifying this equation, we get: 0.05x + 900 - 0.06x = 837. Combining like terms, we have: -0.01x = -63. Solving for x, we find that x = 6300.

Therefore, $6,300 was invested at 5%, and $8,700 (15000 - x) was invested at 6%.