Question

Last year, Amy had $20000 to invest. She invested some of it in an account that paid 8% simple interest per year, and she invested the rest in an account that paid 9% simple interest per year. After one year, she received a total of $1690 in interest. How much did she invest in each account?

Answer 1

Amount invested at 8% rate of interest = $11000

Amount invested at 9% rate of interest = $9000

Explanation:

Let Amy invested amount in a account with 8% simple interest = $a

Then the interest gained after one year =
`\frac{\text{Principal amount}* \text{Rate of interest}* \text{Time}}{100}`

=
`(a* 8* 1)/(100)`

= 0.08a

Remaining amount for the investment = $(20000 - a)

Interest earned after one year with rate of interest 9%

=
`((20000-a)* 9* 1)/(100)`

= $(1800 - 0.09a)

Total interest earned after 1 year = $1690

0.08a + (1800 - 0.09a) = 1690

1800 - 0.01a = 1690

0.01a = 110

a = $11000

Amount invested at 8% rate of interest = $11000

Amount invested at 9% rate of interest = $(20000 - 11000) = $9000