Question

A man invests his savings in two accounts, one paying 3% and the other paying 5% simple interest per year. He puts twice as much in the lower-yielding account because it is less risky. His annual interest is $1496. How much did he invest at each rate

Answer 1

Let

x ----> the amount invested at 3%

y ----> the amount invested at 5%

we have that

3%=0.03

5%=0.05

0.03x+0.05y=1,496 -----> equation 1

x=2y -----> equation 2

solve the system of equations

substitute equation 2 in equation 1

0.03(2y)+0.05y=1,496

solve for y

0.06y+0.05y=1,496

0.11y=1,496

y=13,600

Find out the value of x

x=2y

x=2(13,600)=27,200

therefore

the amount invested at 3% was $27,200 and the amount invested at 5% was $13,600