Question

. Mrs.Scott had saved $6000 which she wished to invest. She put part in a term bank savings account at 8% and part in a regular savings account at 5 1/2 %. How much was invested in each account if her total yearly income amounted to $425?

Answer 1

Sheyla, this is the solution:

Step 1: Let's review the information given to us to answer the problem.

• Amount Mrs. Scott had saved = $ 6,000

,

• Interest rate of the term savings account = 8% (0.08)

,

• Interest rate of the regular savings account = 5.5% (0.055)

,

• Total yearly interest or income = $ 425

Step 2: Let's write the equation, as follows:

• Part of Mrs. Scott savings in the term savings account = x

,

• Part of Mrs. Scott savings in the regular savings account = 6,000 - x

,

•

Thus:

0.08x + 0.055 (6,000 - x) = 425

0.08x + 330 - 0.055x = 425

0.025x + 330 = 425

0.025x = 425 - 330

0.025x = 95

Dividing by 0.025 at both sides:

0.025x/0.025 = 95/0.025

x = 3,800

Step 3: Now we know that Mrs. Scott had saved $ 3,800 in the term savings account. Let's find the amount in the regular savings account:

6,000 - 3,800 = 2,200

Mrs. Scott had saved $ 3,800 in the term savings account, and $ 2,200 in the regular savings account.

Let's prove it, this way:

3,800 * 0.08 + 2,200 * 0.055 = 425

304 + 121 = 425

425 = 425

Our solution is correct, Sheyla.